KB Toys plans to close three of its seven Hawai'i stores and has slashed prices by 30 percent to 50 percent at those locations.

The Pittsfield, Mass.-based retailer has been liquidating its inventory at its Ala Moana Center, Pearlridge Center and Kamehameha Shopping Center locations since Saturday, local store managers said.

All three stores are scheduled to close early next year.

KB stores at Kahala Mall, Windward Mall, Ka'ahumanu Center on Maui and Prince Kuhio Plaza on the Big Island will remain open and are not holding liquidation sales.

"It's been busy because everything is on sale," Julie Takeda, assistant manager of KB's Ala Moana store said of the Christmas season foot traffic at the chain's flagship store.

Officials at KB's Mainland headquarters could not be reached for immediate comment.

Local store managers said they had been given no explanation for the closings.

But the privately held company recently said it plans to close a significant number of its nearly 600 stores nationwide.

And last month, the Washington Post reported that the company would shut down 156 locations nationwide by January.

The closings are just the latest setback for a financially troubled retailer whose Chapter 11 bankruptcy in 2004 resulted in more than 500 store closing and 4,000 layoffs.

A manager at KB's Pearlridge store said the company has been reducing staff during the past several months but that the retailer has given no word on future layoffs.

Kelsey Chai, manager of KB's store in Kamehameha Shopping Center, said the 10 employees are uncertain whether they will have jobs with the company after January.

Chai noted that sales at KB's Kalihi location "are pretty much the same as last year" despite the liquidation sale.

Managers at KB's stores on Maui and the Big Island, and at Windward Mall and Kahala Mall, said that their business has been steady this holiday season.

Reach Rick Daysog at rdaysog@honoluluadvertiser.com.