Retailers throughout Los Angeles are struggling to find ways of coping with nagging holiday hangovers.

Several weeks after the conclusion of what was a disappointing holiday season, local merchants are slashing prices and instituting all sorts of merchandising gimmicks to try and dig out from beneath a mountain of unsold inventory.

Bargain hunters are bagging $120 cashmere sweaters for $50 and $200 velvet evening gowns for $30 at Robinsons-May, and similar slashing elsewhere is chewing away at many store owners’ profit margins.

“There are many retailers who ended up with too much inventory,” said Tony Cherbak, a retail expert at Deloitte & Touche in Costa Mesa. “I can’t name names, but they are predominantly department and specialty stores, due to the fact that everyone had a fairly disappointing holiday season.”

Disappointing indeed.

According to Goldman Sachs & Co.’s retail composite index, December sales rose a mere 0.1 percent. Department store sales were down 0.1 percent, specialty apparel store sales declined 1.5 percent and sales by discounters inched up a weak 0.5 percent.

While specific department stores declined to reveal how much extra inventory they have, they did concede that December sales were lackluster. Federated Department Stores Inc., parent company of Macy’s and Bloomingdale’s, reported that sales for the five weeks ended Dec. 30 were down 0.6 percent from the same period of the previous year.

May Department Stores Co., parent of Robinsons-May, said store-for-store sales in December were up a mere 1 percent. retailers’ predicament. One obvious group of beneficiaries is consumers, who are getting some great values. But so far they do not seem to be rushing out to scoop up the deals, and that may be due to a lack of confidence. Monthly surveys by the Conference Board, a nonprofit organization that tracks consumer habits, show that consumer confidence declined during October, November and December.

But consumers are not the only ones poised to benefit from local retailers’ holiday hangover.

United Apparel Liquidators Inc., a Mississippi-based company that buys high-end designer goods from retailers in Los Angeles and New York for its discount stores in the South, is finding some good bargains in Southern California. “There is a lot of excess merchandise out there,” confirmed a UAL executive who asked not to be identified.

Innovative spirit

The situation is also inspiring some entrepreneurial ventures. Mark Freeman, executive vice president of Pure Beauty, a chain of beauty supply stores, is organizing The Big Deal, a gathering of several specialty store retailers under one roof at the Santa Monica Civic Auditorium in mid-March.

Store owners pay $1,200 and up to rent a booth and sell their excess inventory, much of which is seasonal, so it would otherwise end up in boxes until next winter.

“The vertically integrated retailers are so lucky. Many of them have outlet malls where they can sell their things. We don’t have that luxury,” said Jill Roberts, who owns two stores in Santa Monica and Beverly Hills that carry her name.

Roberts is one of about 50 retailers that have signed up so far to sell at The Big Deal. “Consumers will be getting things at deep discount, and retailers can dispose of inventory at much higher options,” Freeman said.

Or they end up in discount stores like Ross Dress for Less, Burlington Coat Factory and T.J. Maxx.

Other options that small L.A. retailers are looking at include selling to jobbers, liquidators or consignment stores, where they typically receive anywhere from 4 cents to 25 cents on the dollar.

Proceeding cautiously

Industry consultants point out that, while the currently situation may not be pretty, from the retailers’ perspective, it could have been worse.

“There is no question they have more inventory than they like, but they were relatively cautious going into the holiday,” said Richard Giss, a retail analyst with Deloitte & Touche in Los Angeles. “They have been very promotional. That has moved inventory, but it will cut revenues.”

But cut revenues are better than no revenues, so retailers are instituting price slashing and inventive retail tactics. “There are clearly a lot of sales,” noted Rick de Herder, president of Array Marketing Group, a Los Angeles retail marketing consulting company. “Some are planned and some are not.”

January discounts that are normally 50 percent have been upped to as much as 75 percent off already reduced items. “If you have product that consumers passed on before, you have to find new ways to (merchandise) it,” de Herder said.

For example, he said, retailers are placing sale items far enough apart that shoppers have to walk by regular-priced merchandise to see the discounts. Another tactic is to create a center of attraction. “Victoria’s Secret took a lot of items they had been marking down and put them in the center (of the store), all together on a table with a big mark-down sign,” he said. “It was actually a very good sale. There was a tremendous amount of traffic.”

Another response to the situation has been tepid ordering by retailers.

Local apparel manufacturers who attended the annual Intermezzo Collections show in New York in mid-January, for example, noted that merchants are reluctant to order merchandise. “The smaller boutiques seem to be holding off with their orders until February to see if things are going to improve,” said Anamyn Turowski, owner of Claudette, a manufacturer of women’s apparel in Studio City. Orders for her spring line are off by 25 percent compared with last year.