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Premium toy makers and sellers enjoying good holiday season

While mass-market toy retailers are struggling to boost sales and maintain profits this holiday season, specialty toy shops report the opposite. Indications are this will be a good season for the premium toy business.

Betsy Moffitt was buying toys for her grandchildren at Larson's Toy Store at the Worthington Mall. "Ethan is cleaning up", she said.

It seems like stores like Larsons Toys are also cleaning up this season, thanks to customers like Betsy Moffitt, "I'm looking for quality toys, toys that will last."

The cash register and gift wrapping counter were bustling 10 days before Christmas. Shoppers were buying games and other toys. Workers scurried to wrap them in shiny green and red paper.

While mass market toy makers like Mattel and Hasbro report declining sales this year, the sales of premium toys is up. And while Toys R Us and other mass market toy retailers report soft business.

Owners of speciality stores which sell premium, higher priced toys say their sales are up this season. Larson's - with stores in Worthington and Columbus is one such specialty store. It's owner, Greg Larson says his sales are up 25 percent over last year.

Helping sales, Larson says, is the completion of renovations to the Lane Avenue Shopping Center - where his Columbus store resides. He also says the closing of two local Zany Brainy stores have sent premium toy customers to his store. But even taking those elements into account, Larson says he is having one of the best seasons in his store's 23 year history.

A key factor he says is there is no hot toy this season - no furbees or tickle me elmo's grabbing attention and dollars.

The American Specialty Toy Retailers Association represents premium toy makers and sellers. It's executive director, Kathleen McHugh says it's been a good year.

Analysts say the big sellers in the premium toy market are games and dolls. Larsons has sold out of two popular games. Sales of Mattel's expensive American Girl dolls are up 9% while sales of cheaper Barbies are down 26%.

There are many theories for the trend. Some say premium toy sales are up because incomes are up. Others say its because mothers of young children are older and better off financially than they once were.

Ernst and Young's Julie Kunkel monitors the retail industry for clients. She says premium toys are doing well because affluent shoppers are the ones doing most of the buying, and they are the ones who can afford $100 dolls and $200 tricycles.

The premium toy market is doing well despite falling toy prices at stores like Wal*Mart and Toys-R-Us. Kunkle says mass merchandisers discounting has dramatically cut the prices of main-line toys. Ernst and young estimates that toy prices, adjusted for inflation have fallen 20% over the past five years. Such deflation would seem to doom speciality stores but Larson says they can continue to succeed they avoid direct competition.

The toy business is a tough one, with cut-throat competition. But this holiday season has given speciality toy makers and sellers hope that by offering the right toys, and right service, they can compete.