In short, it has promised to match prices that customers find on identical products at top online retailers, such as Amazon.com, the websites of Wal-Mart, Best Buy, Toys R Us and Babies R Us.

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Tossing its hands up, in August 2004 Toys "R" Us announced plans to separate its toy business from its Babies "R" Us unit.

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Babies "R" Us has increased sales 10% annually since 2000, and its EBIT margin (earnings before interest and taxes as a percentage of sales) has averaged 11%.

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It also explains why Babies "R" Us, a division of Toys "R" Us (nyse: TOY - news - people ), has partnered with Motherhood Maternity, opening maternity sections in 55 stores, almost one-third of all locations.

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