The cutbacks are taking place in corporate offices and in stores, and management expects to save about $70 million annually as a result. Also eliminated were $40 million in planned capital expenditures, 2008 bonuses for senior management, merit-based pay raises this year and other expenses.

"We are taking necessary actions to reduce costs in response to additional pressure on the retail industry brought on by significant deterioration in both the financial markets and macroeconomic environment," says Bud Bergren, Bon-Ton's president and chief executive officer, in a statement.

Earlier this month, executives announced that they plan to close an Elder-Beerman store in Hamilton, OH, some time in March. Bon-Ton's December same-store sales fell 5.8% year over year, while total sales fell 5.6%, to $527.2 million.