Analysis By James Arnold BBC News business reporter

Window-shopping won't help WH Smith pay the rent

Slim compensation, perhaps, for shoppers about to brave the horrors of the High Street, but it's shaping up to be a very unmerry Christmas for Britain's retailers.

At first glance, official figures make dull, rather than disastrous, reading.

Retail turnover in November was down 0.2% year on year, according to the British Retail Consortium; the Office for National Statistics says volume sales were up 6.6% in the third quarter of this year.

Footfall, a data company, says traffic through shops rose 8.7% in the first week of December.

But according to most anecdotal evidence, the real beneficiaries of growth have been discounters: low-rent stores such as Matalan, Primark, Peacocks and Argos have been coining it in this year.

Meanwhile, big-name chains are either suffering, or postponing the pain by launching their January sales a month early.

Five live in fear

Next year, it is thought, could finally see the shake-out in British retailing that some pundits have long predicted.

Five names keep cropping up on the danger list - Woolworths, WH Smith, Boots, Sainsbury's and Marks & Spencer.

What does 2005 hold for them?

Is the medicine finally starting to work?

Boots is a curious mixed bag: profits halved this year, but its customer traffic - more than 20 million shoppers a week - is impressive and still growing.

Latest result: Pre-tax profits of �147m for first half 2004, down 48% 2003 turnover: �5.3bn Employees: 69,259

Pessimists say Boots has lost its way. A company with a strong identity as a chemist has no business selling sandwiches, Scalextric sets or DVD players. Forays into related businesses such as dentistry and chiropody have not paid off, and the core pharmacy business is under threat from the supermarkets.

Nonsense, say its defenders. Boots' burgeoning variety of product lines simply gives people yet more reasons to cross its threshold. Boots is an unbeatable household name and High Street presence. Its management is gung-ho and relatively new, and its balance sheet is sound, boosted by cost-cutting and disposals, such as the sale of car-parts chain Halfords.

True, Boots' once-lavish profit margins have fallen sharply, thanks to more aggressive pricing, but management reckons it is cutting costs fast enough to make up for lost ground.

Boots has pledged to go "back to basics" in 2005. An often-heard and dangerous pledge, perhaps - but possibly one that may pay off.

Things wouldn't look half so bad at Sainsbury's if it weren't for Tesco.

Latest result: Pre-tax loss of �39m for first half 2004, down from �323m profit a year earlier 2003 turnover: �17.1bn Employees:150,000

Although analysts give Sainsbury's points for effort - especially since Justin King was named as chief executive in March - they always seem at least a pace behind their bigger rival.

The bleeding of market share is not yet critical. It still has 11% of the UK market, just behind Asda.

But the problem is one of inspiration: there seems no conceivable way that Sainsbury's can stem its slow decline.

Mr King is throwing himself into a frenzy of activity: having focused on a tidal wave of marketing in recent years, it is now going back to distribution and shelf-stacking - still a glaring failing despite �3bn spent on infrastructure under the previous regime.

This year, the company has fallen into its first-ever loss - in a period where Tesco made an �822m profit.

Once again, the call is "back to basics". But there has been so much squirming around at the firm that it's hard to say what basic is any more.

Depending on your point of view, M&S's decision to launch a pair of one-day sales in the pre-Christmas rush smacked either of desperation or of long-awaited retail savvy.

Latest result: Pre-tax profit of �293m for first half 2004, down 10% 2003 turnover: �8.3bn Employees: 46,654

The move was, apparently, a success, at least in terms of getting punters through the doors.

Getting them to spend money is the next challenge - one managers hope to address by streamlining the store's messy product range, and stressing quality.

Regaining credibility among investors will not be easy: sales were down 4% during the first half of the year, including a near-20% plunge in homewares, and management is struggling to reverse a string of bad decisions, notably the preposterous Lifestore furniture shops.

Broadly, analysts seem willing to give new chief executive Stuart Rose time to build on the encouraging noises he has made so far (including the inevitable promise to go "back to basics").

Not much time, though: "I'll give them six months," says one analyst.

Whether WH Smith will have even six months is a good question.

Latest result: Full-year* pre-tax loss of �135m, down from �52m profit in 2003 2004 turnover: �2.5bn Employees: 18,652 * Results for 12 months to end-August 2004

The stationer, long one of the best-loved names on the British High Street, has fallen on dreadful times in recent years.

Analysts identify a string of blunders, ranging from its focus on a narrow range of mass-market books and CDs (precisely the sector being gobbled up by the cheaper supermarkets) to its bizarre choice of a worm mascot to headline its Christmas advertising.

Chief executive Kate Swann is bullish, and has pushed through a string of reforms, including a far tighter oversight over day-by-day sales performance. And the firm's fans insist it scores over supermarkets thanks to its enviable town-centre locations.

Those locations, though, are now its main source of value. It's hard to find an analyst who will bet against the firm falling into the hands of an investor who's more interested in real estate than reading.

Until recently, Woolies was the store the others sneered at.

Latest result: Pre-tax loss of �33m in first half, up from �35m loss a year earlier 2003 turnover: �2.8bn Employees: 34,900

Its strategy, or what passed for one, was to sell a seemingly random selection of low-value goods to the poorest members of society.

For a couple of years after it was spun off from Kingfisher in 2001, the firm's performance suffered accordingly.

Things may now be starting to pick up. Woolworths is smartening up its stores - it's already done the work on about 15% of its space - and refining its focus to "kids and celebrations".