Retailers stock up survival gear as outlets face another soft year.

Shaken by lackluster consumer spending and a recession-fed market shift, retailers are sharpening their survival skills to make it through 1992.

Those skills will be essential, retail analysts said, because the new year will ring in even more trouble for department stores and other high-end merchants as consumers flood discount and niche-market outlets.

Strategies for the new year will include discount pricing and an emphasis on merchandise with "perceived value at any price," said Gregg Sloate, an independent retail analyst in Los Angeles. "This is not to say we're starting a trend, these are just tactics to get by, to post greater profits."

Arthur Shaw, economist with the Los Angeles Area Chamber of Commerce, said overall sales "should continue to exhibit a pattern similar to '91, maybe with a slight decline."

"Our economy looks a little weaker than the U.S. economy," he said. "I'm not predicting a disaster. I expect next Christmas to be better. We will see a little light come Spring, and Summer will see a completion of the turnaround."

But, at the close of 1990, retail analysts painted a similar picture for 1991 -- a slow first half, with the economy picking up in the third and fourth quarters.

"We didn't realize how bad the recession would be," said Sloate. "We thought the third and fourth quarters would be better" in comparison to the same periods in 1990. He, like Shaw, foresees a soft market for the first few months of '92.

Most analysts see department stores as a dying breed. Said Sloate, "I wouldn't be surprised to see some chains go under."

Maybe the largest chain in Los Angeles County in the most immediate danger is Carter Hawley Hale Stores Inc., parent of 43-store Broadway-Southern California department store chain. But spokesperson Bill Dombrowski said, "We disagree with people who say that (department stores are a dying breed). . . . we've been hearing it for the last 10 years."

Carter Hawley Hale, he said, is looking forward to the successful completion of its negotiations with the Zell/Chilmark Fund, which offered to infuse $220 million into the company to pay off some creditors. Another $50 million was offered for renovation of Carter Hawley Stores. These funds will eliminate almost $600 million worth of debt, said Dombrowski.

The completion of the Zell/Chilmark negotiations is expected in April or June.

"What we have to do," said Dombrowski, "is keep providing the right merchandise, keeping up with the fashion environment. And it has to be exciting. There has to be something going on."

Economist Charlotte Chamberlain agreed that excitement will be a key in 1992. The specialty stores and trendy areas will be bustling.

Chamberlain, vice president at the National Economic Research Association, said that "extreme niche marketing will do well," pointing to the stores on Melrose Avenue as an example. These stores and others like them will be fine in the new year, not only because they cater to a specialized market but also because it's fun to shop there, said Chamberlain.

"There is an entertainment value as well. It is more than just shopping -- the people who are there, the merchandise, there is so much to see," she said. Chamberlain specified that next year's particularly hot retail areas will include Melrose Avenue between LaBrea and Fairfax avenues, LaBrea between Second Street and Beverly Boulevard, the new City Walk underway at Universal Studios, and Hollywood Boulevard between Highland Avenue and LaBrea.

Analysts agreed that for general merchandise, the discounters and factory/wholesale outlets will continue to draw on a large customer base due to their lower prices.

In the grocery business, 1992 will see a "growth towards outer areas" of the county, said Steve Koff, president of the Southern California Grocers Association. He specifically noted the arrival of Salt Lake City-based Smith's Food & Drug Centers, which entered the Lancaster market.

Next year, he said, "a lot depends on the economy, but the food industry is quick to respond to changing demographics." He said he expects more niche marketing from grocers next year, including more stores which cater to Hispanics or carry upper-scale items.

The grocery industry, regarded as one of the most competitive in retailing, "is here to serve the marketplace as a whole," said John Golisch, partner in charge of retailing in Southern California for Arthur Andersen & Co. Thus, he noted that grocery stores will have to "maintain their customer base" in order to stay ahead next year.

The outlook for the automotive industry, which performed dismally in 1991 due to the recession and added government regulation, will depend on the general health of the economy.

"As the economy goes, so will the car dealers," said Peter Welch, director of government and legal affairs for the California Car Dealers Association. "When people feel confident, they will buy cars."

He said that 1992 could be a turbulent legislative session in Congress for the automotive industry. Still, he hopes to see a "reasonable bill" outlining the policy on "dualing," or operating more than one franchise under the same roof. The bill, which has yet to find an author, would basically say that manufacturers cannot prohibit a dealer from dualing. The manufacturers don't like dualing, he said, because they don't like the on-site competition.

New retail construction could "go below $300 million in '92," said director of research Ben Bartolotto at the Construction Industry Research Board. About $348 million in new retail construction went up in Los Angeles County in 1991, he said, and that figure was down from $508 million in 1990. In fact, should new construction drop below the $300 million mark, it would be the lowest since 1983, he said.