Walmart is cutting its toy space by more than half in a new initiative to re-make its stores, according to TD Monthly.  The new initiative, called “fast, friendly, clean,” will widen store aisles, cut aisle and end caps, and affect the number of SKUs carried in various departments.

The reduction in toy SKUs is being rolled out to under a quarter of the chain’s stores this summer, according to the report, followed by any necessary tweaking to the program before rolling it out to all stores across the country.  The impact will be felt both in the number of SKUs from each vendor and the number of vendors. 

Assuming this change is rolled out to the entire chain of the nation’s largest toy retailer, it will have a dramatic impact on the toy business.   It will create greater opportunities for other toy retailers, including mass merchants, such as Toys R Us and Target, and independents.  But it will probably also place short term pressures on the toy companies that supply Walmart’s toy aisles as sales through Walmart decline and sales through other channels grow to fill the void.