W. Bell & Co., the Rockville-based catalogue-showroom discounter, filed for protection from creditors under Chapter 11 of the U.S. bankruptcy code yesterday following a decade-long onslaught from price-cutting competitors and a disappointing 1990 Christmas season.

Bell said that as part of its bankruptcy reorganization, it will close four stores in Georgetown, Fair Oaks Mall, Potomac Mills and downtown Baltimore in the next few weeks, leaving it with 10 area showrooms. A Bell spokesman would not disclose how many employees will be affected by the closings of the stores, which sell merchandise ranging from tennis balls to cameras.

As a discounter, Bell's edge in retailing was its cheaper prices. But widespread discounting by other specialty and department stores in recent years eroded much of that advantage for Bell and other catalogue-showroom retailers, analysts said.

"It'll be the first of many such filings," said Walter Loeb, a New York-based consultant and specialist on the retail industry. "This was an extremely weak Christmas. Many retailers had hoped that Christmas would give them enough money to let them pull through a cash crunch, but it didn't happen. Many retailers, particularly the catalogue showrooms, have been dependent on Christmas. But consumers held back this year. They spent less and went for smaller items."

Bell's bankruptcy filing was the latest in a series of retail filings in Washington this year. In addition to Bell, retailers that have sought bankruptcy court protection include Garfinckel's; Fantle's drugstores; Stern Office Furniture Inc.; Ruth Rider Inc., parent of the Sassafras women's discount clothing chain; and Virginia-based Wilson's Men's Stores.

Bell's decision to file for bankruptcy court protection comes after months of unsuccessful attempts to sell the company and after yearlong belt-tightening measures that, in addition to the Washington-area closings, include plans to shut down six stores in Chicago early next year.

Although Bell's $40.7 million in assets -- including valuable Washington real estate -- exceed its liabilities by about $7 million, its cash shortage became too acute to avoid the bankruptcy filing. In short, the company said in papers filed in U.S. bankruptcy court in Rockville that it couldn't pay its bills.

Among its largest unsecured creditors, Bell listed Brown Printing Co. of New York, Sony Corp. of America and AT&T Consumer Products, with combined outstanding claims of about $3 million. The remaining 17 largest unsecured creditors have claims of less than $200,000 each, according to the court filing.

The company also disclosed yesterday that prior to the start of the Christmas season, it had substantial 1990 losses and declining sales. In the third quarter ended Nov. 3, Bell lost $5.8 million on sales of $15.7 million compared with a loss of $833,000 on sales of $20 million in the third quarter of 1989. For the first nine months of its 1991 fiscal year, the company lost $9.7 million on sales of $56.3 million; last year in the comparable period it lost $2.3 million on sales of $66 million.

The Chapter 11 bankruptcy filing, which allows Bell to continue operations while it works with creditors to develop a debt payment plan, was not unexpected.

"It reflects a shakeout in the industry more than anything else," said Kenneth M. Gassman Jr., retail analyst at Wheat First Securities Inc. of Richmond.

As the catalogue-showroom industry has changed, the company, founded by the Bell family of Washington in 1950, has been hurt by its own failure to better adjust to changes in retail marketing, analysts said.

Bell shares problems with the rest of the industry. It was the ninth-largest showroom catalogue company in 1983, with 18 showrooms. Today, it is fifth-largest in the industry, but only because so many others have gone out of business or have merged with other companies in the last five years, analysts said.

Recently, Richmond-based Best Products Inc., the second-largest catalogue-showroom company, with 200 showrooms and close to $2 billion in annual sales, announced that sagging sales required it to suspend payments to vendors in December, Gassman said.

Catalogue showrooms were a shopping concept developed 30 to 40 years ago to offer low prices on nationally advertised brand-name products such as cameras, electronics, toys, sporting goods, home accessories and jewelry.

By the late 1970s however, K mart Corp., Wal-Mart Stores Inc. and a host of other price discounters sprang up, offering the the same low prices but with more selection, better location and better service. Not only were low prices no longer a competitive advantage, but the catalogue-showroom shopping procedure -- selecting an item, filling out an order, paying for it and then picking it up -- began to look complicated and needlessly burdensome by comparison.

Though the catalogue showrooms do provide some goods via help-yourself, off-the-shelf shopping, it is not a significant percentage of sales, according to analysts.

"The catalogue showroom industry really hasn't responded to consumer needs," Gassman said

More recently, the catalogue showrooms have faced fierce competition from "category killers" -- speciality chains like Circuit City Stores Inc., Toys R Us Inc. and Herman's Sporting Goods Inc. -- that further eroded market share.

Jewelry sales, which for showroom retailers like Bell typically account for anywhere from 25 percent to 40 percent of revenue, also have recently suffered as the economy turned down and a number of specialty chains, such as Kay Jewelers Inc., began aggressive discounting programs.

Last spring Bell, which has publicly traded stock but is controlled by the Bell family, put itself up for sale. So far, it has found no takers despite the company's ownership of real estate in the Washington area. Several months ago, the company announced that a Hong Kong firm expressed interest in purchasing Bell for about $9.5 million, or less than the amount at which the company was trading on the open market at that time. Bell Vice President Martin Pfeifer said yesterday that talks with the Hong Kong firm were continuing.

In over-the-counter trading yesterday, Bell stock closed at 50 cents, down 75 cents. In the last five years, Bell's stock traded at a high of $8.59 a share.