At Tiffany’s, life is imitating art…

If your holiday shopping includes a trip to Tiffany & Co. (TIF) this year, you may have to wait a bit longer than in past years for a clerk to tie that perfect white bow around the signature blue box.

Yes, Tiffany’s — the iconic jewelry store that Holly Golightly (as played by Audrey Hepburn in —Breakfast at Tiffany—s) swore was so special that —nothing very bad could happen to you there — is dealing with its own economic case of —the mean reds.

The big news in the 10-Q that Tiffany’s just filed is that last week the company rolled out a program to offer voluntary retirement buyouts to up to 800 employees who meet —certain age and service eligibility requirements. It may spend between $50 — 65 million on the buyout packages, which are available to eligible employees through January 12, 2009. Executives are not —eligible to accept the buyout.

One reason that Tiffany’s is offering buyouts is tied to sales, which declined at comparable U. S. retail stores 14% in the third quarter and 6% for the year. The only real bright spot for the company’s U. S. sales occurred at the New York Flagship store, which benefited from increased sales to foreign tourists. (Meanwhile, in Europe, at least, comparable store sales rose between 8 — 10%.) Tiffany’s also took a $4.3 million pre-tax charge in the third quarter, a step that was necessary after Lehman Brothers Special Financing Inc. was no longer around to pay up on some interest-rate swap contracts.

One thing the company is doing in response to its economic mean reds is scaling back its expansion plans. In 2009, the company will now open approximately five new stores in the Americas and eight or so in Asia-Pacific and/or Europe. (And, as this report notes, the company may move some of its existing inventory into those new stores.)

It’s also planning to borrow another $300 million —to address the Company’s current and future liquidity requirements. So long as the credit markets don—t get much worse — which would increase the cost of the loans or make them even more difficult to obtain — Tiffany’s expects to be able to weather the storm.Per the Q:

Based on the Company’s financial position at October 31, 2008, management anticipates that cash on hand, internally-generated cash flows, the funds available under its revolving credit facility and the additional sources of funding that the Company has already secured and is currently pursuing will be sufficient to support the Company’s planned worldwide business expansion, working capital increases and debt repayments for the foreseeable future.

Let’s hope they’re right. And let’s hope that by next year, we’re reading lots of filings that take us back to the —nice greens.”

Image source: Tiffany & Co.