The Johnny's Toys story began during the Depression years of the 1930's. Bill Martin worked at Miss Mary's candy store on Decoursey Ave. in Latonia (South Covington), Kentucky, and in 1939, took over the small business. In the early years, school supplies, books, and candy were the main business with toys an added attraction. At a time when most toys were purchased at hardware and department stores, it was a novel concept to see them displayed year-round and not just during the Christmas season.

The business prospered as the country emerged from the Depression, but then World War II threatened to end the store's short history. Bill entered the Army Air Corp and served three years in the South Pacific. While away, Bill's father and sister kept the store in operation despite rationing and material shortages caused by the war effort. During this time, Johnny's Toys got its name. Bill's older brother, John Martin, was a well known personality in the Latonia area. Everyone assumed that if the Martins had a business, it must belong to Johnny. Before long the name stuck and the store was known by the locals as Johnny's Toys.

Johnny's Toys became a household name in the Greater Cincinnati area with its Birthday Castle, Hobby Department, and year-round layaway plan. Johnny's Toys originated the concept of low prices and wide selection long before the national chain stores came into being.