China on the mind at FAO Schwarz

Upscale retailer displays country-of-origin labels and offers alternative items for shoppers fearful of lead-tainted toys.

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By Aaron Smith, CNNMoney.com staff writer

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FAO Schwarz tried to address concerns of shoppers worried about toys made in China.

NEW YORK (CNNMoney.com) -- Sales are booming this year at FAO Schwarz, despite the fact that most of its toys are made in China, a country that's come under scrutiny for product safety.

Millions of Chinese toys have been recalled because of dangerous lead paint coatings and faulty designs.

As a result, FAO Schwarz Chief Executive Ed Schmults said he knew his Black Friday clientele would be concerned so the store added country-of-origin tags to all of its wares.

"People aren't coming and saying, 'I want anything not made in China,' but customers are asking a lot of questions," said Schmults, just minutes after his Manhattan store opened its doors for the Black Friday crowd.

Schmults also said his employees have been trained about product safety, and schooled about which alternate products to suggest for customers who want to steer clear of China-made items.

"A lot of concerned parents and grandparents have been asking about whether the products are made in China," said Vanessa Guardian, an employee at the upscale Manhattan toy store. She guided those customers toward products made in other countries, like the Steiff and Gund lines of German teddy bears.

But the sinophobes weren't taking a bite out of business.

Schmults, speaking between bites of a cookie at the store's coffee bar, said that Thanksgiving day sales were a third higher than last year's and overall sales are up 68 percent year-to-date. For FAO Schwarz, Thanksgiving is typically a bigger seller than Black Friday because the store's location is convenient for parade-goers, said Schmults.

On Friday, FAO Schwarz drew shoppers who said they viewed the upscale store as a haven from tainted toys.

"It's difficult to see if a product is OK," said German tourist Sabina Hartman. Hartman said she was shopping at FAO Schwarz because of its reputation for higher-quality - and presumably safer - products.

Browsing through the LEGO section, Marty and Amy Fitzgerald of Youngstown, Ohio, said they weren't too concerned about product safety because their sons, aged 7 and 4, were old enough to know how to use toys safely.

"Our kids are past the age where we have to worry about them putting toys in their mouths," said Marty Fitzgerald.

As Black Friday customers went cuckoo at Wal-Mart, Target and other outlets all over America, the ambience was more civilized at FAO Schwarz, an independently-owned store known for its massive plush animals.

"I want the giant yak," a child announced to his parents, strolling past a saber-toothed tiger.

Just a few minutes after the store's doors opened, there was ample elbow room throughout the multi-level store.

Customers browsed calmly past stacks of toy helicopters and rows of blue and pink dogs. This was a dramatic contrast to the retail hysteria seen at the Toys 'R' Us flagship story in Times Square a few hours earlier. There, customers who had waited outside for hours frantically grabbed merchandise when the doors opened at 5 a.m.

The Zune MP3 player was a hot item at Toys 'R' Us and its limited stock was cleaned out almost instantly. In a repeat from last year, the Wii was also a popular product.

"If you look at the really hot items that are out there, none of them are made in America," said toy industry analyst Jim Silver and co-editor of Toy Wishes magazine. To top of page

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.