My students have been BEGGING me to learn multiplication and division. So, I caved. :) I just introduced the concept last week using fruit loops and little construction paper squares. (These were simply the items that were available to me - I would recommend using a mono-colored cereal, some of my students were focused on color sorting the cereal instead of multiplying/dividing)
Hopefully this is pretty self explanatory, but here's some examples.
Division: For a problem like 6 divided by 3, I told my students to first count out 6 fruit loops. Then they were to divide the 6 fruit loops equally between 3 of their squares. So, how many fruit loops are on each square?
And one of my students grabbed some sticky tack and I found this on his desk :)