A brutal environment for department stores claimed another victim yesterday as the Reading-based Boscov's Department Store chain moved to use the bankruptcy court process to try to stabilize relations with vendors and survive the economic downturn.

As a result, the 49-store retailer will exit Allegheny County just two years after its arrival. Boscov's is planning to close 10 underperforming stores, including sites at Monroeville Mall and South Hills Village that employ a total of about 300 full- and part-time workers.

The Chapter 11 bankruptcy reorganization filing in Delaware early yesterday may signal just how painful the current retail market is at the moment, according to industry observers.

Boscov's has long been a survivor, one of the few family-owned regional players still around after years of closings and consolidations.

But recent months have seen bankruptcy filings at chains such as Linens 'n Things, Sharper Image and Steve & Barry's. Many players in the department store sector have reported declining sales at established stores and, just last week, the Mervyns department store chain in California filed for bankruptcy.

Last month, Macy's executives received a letter from Chairman Terry Lundgren meant to reassure them that things were on track despite tough times.

"The department store segment is not going to get better," predicted Howard Davidowitz, chairman of Davidowitz & Associates Inc., a national retail consulting and investment banking firm headquartered in New York.

Not long ago, reports surfaced that Boscov's was having difficulty paying creditors. "This sort of becomes a self-fulfilling prophecy," said Mr. Davidowitz.

Heading into the key back-to-school and holiday shopping seasons, Boscov's needed supplier support. But many have been pinched by tight credit markets and rising expenses, and they're stretched meeting the needs of national chains such as Macy's, J.C. Penney and Kohl's. "The regionals get squeezed," said Burt Flickinger, managing director of Strategic Resource Group, a retail consulting firm in New York.

According to the company's court filing, its largest creditors include Jones Apparel Group, Adidas, Levi Strauss & Co., Polo and Serta Mattress Co.

The bankruptcy process should help "normalize" relations with vendors, as well as allow Boscov's to close weaker stores, revisit certain agreements and generally stabilize the situation. With $250 million in debtor-in-possession financing from Bank of America, the company expects to establish a steady flow of merchandise, as well as the ability to pay salaries and otherwise maintain operations.

How quickly the company, the court and creditors move to get money flowing could impact Boscov's chances for emerging successfully from bankruptcy. Filing for bankruptcy is never particularly good, but doing it in early August is really awkward.

"They've got to get the back-to-school merchandise on track fast," said Mr. Davidowitz. "That is their first priority."

The court also will need to approve the process used to liquidate merchandise at the stores to be shuttered. A company spokeswoman said no dates have been set but an orderly wind-down of business is expected over the next few months.

Boscov's entrance into Allegheny County two years ago was part of a bold move by the independent to take advantage of industry shifts. The retailer picked up a total of 10 sites owned by Federated Department Stores, the parent company of Macy's, which had acquired the parent company of the Kaufmann's and Hecht's chains.

As Macy's moved to offer more upscale merchandise, Boscov's aimed at mid-tier customers with an old-fashioned mix of clothing, toys and even appliances.

The decision to close the two Allegheny County stores means those locations didn't work, said Mr. Davidowitz, although he declined to speculate on the reasons. Boscov's will continue to have a presence in the region with locations in Butler, Monaca, Altoona and Johnstown.

Just what may replace the anchor stores at Monroeville Mall and South Hills Village won't be clear for a while. Fashion-oriented department store chains tend to be pulling back on the pace of new store openings these days.

Upscale retailer Nordstrom, which this fall enters the region with a store at Ross Park Mall, would probably be one of the top tenants sought by South Hills Village mall owner Simon Property Group, said David Glickman, a vice president at Grubb & Ellis who works in retail real estate. But Nordstrom, which has had its own issues with slowing sales, might not want to rush into a second location in the market.

Non-traditional mall tenants such as Target and Whole Foods Market might be an option for South Hills Village, said Mr. Glickman. Another possibility would be a movie theater with adjacent restaurants.

Either location could be divided up into smaller pieces to bring in retailers who are generally found in non-mall sites, said Mr. Davidowitz. It could take time, as chains wait for improvement in the economy or brokers wait for the right deals to come along. Monroeville Mall is owned by CBL & Associates.

Meanwhile, Boscov's may face difficult choices as creditors try to determine whether the retailer can survive. Even if it does, the company may need to bring in a private equity partner eventually, Mr. Davidowitz said.

That would be a big change for the operation founded in the early part of the last century by Solomon Boscov. A couple of years ago, the company pulled off a recapitalization and restructuring to allow the founder's son, Albert Boscov, and son-in-law, Edwin Lakin, to retire but keep the business in the family.

The current chairman, Kenneth Lakin, is the grandson of the founder. Total annual sales hit $1.3 billion.

"Boscov's, to its credit, was a very solidly run company," said Mr. Flickinger. He said store management was good and the promotions were effective.

Now, the retailer's future depends on those involved in the bankruptcy process, he said. "If everybody's smart, Boscov's will survive."