Flat is the new up.

In this environment, hitting last year's numbers, or getting close, is looking good to anyone who sells to the U.S. consumer.

As seriously impaired households spend a higher percentage of income on food, fuel, education and health care, retailers gathered in Dallas to share strategies for today's competitive environment.

These days, seeing only a small decline in sales is being viewed as a positive, said Texas A&M University marketing professor David Szymanski, who serves on the boards of Zale Corp. and OfficeMax Inc. "Retailers need to be careful that they don't let it become a mind-set."

Before the financial meltdown, retailers were already bracing for a recession-era holiday season by lowering inventories, canceling orders, hiring fewer temporary workers and building up cash.

Several retail companies have already filed for bankruptcy this year, including apparel chain Steve & Barry's, home furnishing retailer Linens 'n Things and regional department store chain Mervyn's.

Friday's unemployment added more bad news. Employers cut payrolls by 159,000 jobs in September, for the ninth straight month of job losses. A total of 760,000 jobs have been eliminated so far this year.

J.C. Penney Co. chairman and chief executive Myron "Mike" Ullman said lowered expectations reflect consumer sentiment he hasn't seen since the recession of the early 1990s.

Earlier this week, the Commerce Department said consumer spending was flat in August. And while incomes rose 0.5 percent, the personal savings rate fell to 1 percent from 1.9 percent as consumers paid more for essentials.

Today's customer is especially price-driven, said Carl Sewell, chairman of Dallas-based Sewell Automotive Cos. He said he hopes 2008 results from his nine car dealerships get close to last year's 24,000 units sold.

"If you don't sell food or fuel, it's hard to keep sales rising," said Tuesday Morning Corp. chief executive officer Kathleen Mason, referring to better-than-average retail sales gains this year from Wal-Mart Stores Inc. and Costco Wholesale Corp.

Ms. Mason made the case that while 3,000 stores closed in the first half of the year and a total of 6,500 are forecast to be shuttered by year-end, the industry is still suffering from overcapacity.

"One would think with so many stores closing, business would be up for the rest of us," she said. "It's barely a dent."

The summit has been put on by Texas A&M's Center for Retailing Studies for 25 years. The center is part of A&M's Mays Business School.