With scissors, an overstuffed pin cushion, and a tape measure laid out before her, Yeohlee Teng sizes up the model  parading around her showroom in New York’s garment district. Teng, whose minimalist, architectural styles have made her a darling of museum curators and high-minded fashionistas, has only a few days before her Fashion Week runway show. She worked all weekend styling potential runway looks, and the pressure is mounting. After a few seconds, she orders the young woman to display herself from a different angle.

“People look at you mostly sideways,” she informs the model, a lanky brunette who quickly shifts on her trendy black ankle boots to offer Teng a side view, akin to how fashion editors will see her strut on Monday afternoon.

Teng, a nearly 20-year veteran of the fashion industry, is highly attuned to the various angles fashion designers must try to hit with their work—they need ideas that move the fashion needle as well as items that consumers will buy. But economic challenges are looming as large—if not larger—than creative ones as the fashion industry gears up for the Spring 2009 shows, which begin in Bryant Park today. Falling retail sales, a weak dollar, rising costs for overseas labor, jittery consumers, and a global economic slump provide a grim real-world backdrop to the runway glitz and party circuit.

In fact, thanks to the customary first Thursday of the month release date for sales results from the previous month, a big shovelful of bad news came just in time for Fashion Week. Same-store sales, a key barometer of retail health, declined for most stores other than Wal-Mart as cash-strapped consumers pulled back on shopping. Worse, the upscale chains selling the designers who show during Fashion Week—and who are heading into town or gearing up to place orders—turned in particularly poor results. Saks posted a 5.9 percent same-store sales drop, while Nordstrom’s same-store sales slid 7.9 percent. Consumer researchers don’t expect shoppers, even at the high end, to open their wallets wide again soon.

“We’re seeing continued spending deferrals, especially on apparel,” says Phil Rist, executive vice president of strategy at Worthington, Ohio-based BIGresearch, which surveys more than 8,000 consumers every month about the economy and shopping. “There’s a lot of anxiety about the future.”

Fashion industry executives often profess “cautious optimism” in the face of gloomy business conditions, and Teng is no exception. “I really feel in good times and in bad times there are people who make money and are successful,” she says.

But this season she and others are adjusting to the deteriorating economic picture. Some shifts, like negotiations on the price of imported fabric, are never seen by the fashion front row, while others, such as a runway show’s venue—big Tent or smaller Salon at Bryant Park, or off-site—send a very public message. Teng, whose philosophy centers on using every inch of a given bolt of cloth, has changed her already careful fabric-buying to save money. Nicole Miller, meanwhile, has concentrated this year on smaller shows that still pack a marketing wallop.