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BRAIN POWER TAG TEAM TOY STORE UP, RUNNING.

Byline: Brent Hopkins Staff Writer

VALENCIA - Proving its name was aptly picked, The Right Start's test entrance into Zany Brainy has already paid off.

The upscale baby products retailer, with corporate offices in Calabasas and operating under the newly formed umbrella of FAO Inc., has quietly opened its first test boutique within the Valencia Town Center's Zany Brainy. Still in the process of ironing out the look, the store-within- a-store concept will eventually roll out across the chain's nationwide empire, totaling 130 locations by year's end. Valencia, the first working prototype, saw immediate results.

``It's definitely already boosted business by $500 to $600 a day without even advertising,'' said Bill Herbison, the store's manager. ``It's been a big change. We had to completely reorganize the store and move our products around to fit their lineup, but it's been good.''

The launch, which includes The Right Start's 1,000 best-selling products, from sunglasses to car seats, represents a key part of the chain's radical shake-up from a niche firm to a sudden major player in the toy business. It purchased Zany Brainy in August, saving the well-respected chain from financial woes, then snatched premier toy chain FAO Schwarz for $55 million in November. The company then changed its name to FAO Inc. last month, relaunching its headquarters in King of Prussia, Pa., and rebadging its stock under the ticker FAOO on Thursday.

Executives planned the combination of Zany Brainy and The Right Start from the start, using the larger, better-known chain's market share to grow its smaller but richer sister store. The Right Start gains 1,000 square feet of store space in each spot but piggybacks off Zany Brainy's widespread reputation.

``Zany Brainy is a good brand that did some very dumb things,'' said Kurt Barnard, president of Barnard's Retail Trend Report. ``It gives a lot of toy stores a run for their money, but the expansion was unwarranted given their financial position in the past.''

He applauded the move, saying it would prove mutually beneficial to both brands.

``It won't hurt, especially since Zany Brainy's not losing much floor space,'' he said. ``It enhances the product assortment in the store. I think it's a good idea. Consumers will respond favorably for the convenience and assortment.''

Shoppers of the Valencia boutique proved Barnard correct, as they flowed from one section to another, shopping equally from both brands. Elizabeth Froemming, a Valencia homemaker, kept watch over her daughters Elly, 1, and Maddy, 3, as they romped about the aisles.

``I used to have to go to The Right Start for the little one, then Zany Brainy for the big one,'' she said. ``Now I don't have to move around as much. I like the way they put everything together.''

Only a year ago, Zany Brainy was in serious financial trouble, near bankrupt from its overambitious growth plan. But Herbison isn't worried about his job security anymore.

``We're not going anywhere,'' he said, confidently. ``We'll be around for a long time now. We've got a good customer base, and with The Right Start with us, we have no competition any more.''

CAPTION(S):

4 photos

Photo:

(1 -- color in Business section only) Elly Froemming, 1, pushes her stroller through The Right Start-Zany Brainy store in Valencia.

(2 -- color -- ran in Business section only) Employees arrange merchandise on the shelves at The Right Start-Zany Brainy store in the Valencia Town Center.

(3 -- color -- ran in Business section only) Featuring toys such as Beanie Boppers, The Right Start's entrance into Zany Brainy has gotten off to a good start.

(4 -- ran in Business section only) Valencia resident Gabbi Klein looks at toys at The Right Start-Zany Brainy store in the Valencia Town Center.

Andy Holzman/Staff Photographer
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Title Annotation:Business
Publication:Daily News (Los Angeles, CA)
Date:Apr 20, 2002
Words:623
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