ProfitLogic's New Merchant DesktopTM Gives Merchants Greater Visibility and Control In-Season

Boston, Mass. – December 13, 2004 – ProfitLogic, the industry-leading provider of Merchandise Optimization solutions that deliver the highest return on retailers' inventory investments, today announced that The Children's Place Retail Stores, Inc. (Nasdaq: PLCE), a leading specialty retailer of children's merchandise ages newborn to 10 years, selected ProfitLogic's Markdown Optimization solution. The solution will be implemented across the company's more than 700 Children's Place stores and more than 300 Disney Stores, which The Children's Place operates through its wholly-owned subsidiary. ProfitLogic's solution should enable The Children's Place to boost gross margin dollars and mitigate risk by leveraging insight into customer demand and applying it to critical in-season inventory management decisions.

ProfitLogic's Merchant DesktopTM will provide The Children's Place with better visibility and control over the performance of merchandise in-season. This monitoring, reporting and early warning system enables merchants to quickly respond to unexpected opportunities and issues.

“ProfitLogic's solution will enhance our merchandising process, giving us another tool through which to reduce our markdown rate and complement our strategic growth initiatives,” said Ezra Dabah, Chairman and CEO of The Children's Place. “ProfitLogic understands our business goals and has demonstrated a superior level of expertise and professionalism throughout the evaluation process.”

The Children's Place will use ProfitLogic's Markdown Optimization solution to identify merchandise that is under performing and the pricing action required to boost demand. Applying science to the art of merchandising will allow the Company to adopt a more rigorous approach to markdowns.

“We believe opportunity exists to enhance our traditional pricing process with a more scientific approach,” said Richard Flaks, Senior Vice President of Planning, Allocation and IT at The Children's Place. “Through greater visibility and the ability to mitigate some risk, ProfitLogic's solution supports our objective to aggressively grow store productivity and the top-line.”

“The Children's Place is a fast growing, leading specialty retailer in the newborn to age 10 category,” said Tom Ebling, CEO of ProfitLogic. “ProfitLogic's solution will build upon the Company's current sales momentum by providing another tool through which to evaluate the financial impact of crucial merchandise decisions before taking action.”

ProfitLogic provides industry-leading Merchandise Optimization solutions designed for retailers whose top priority is getting the highest return on inventory investments. ProfitLogic's customers have found that using insight into future customer demand results in more profitable merchandising decisions and more time to focus on what matters most: the customers and the merchandise.

To read more about the Merchant DesktopTM and ProfitLogic's In-Season Management Capabilities, click here: ProfitLogic Addresses Emerging Demand for In-Season Merchandise Management.

About The Children's Place
The Children's Place Retail Stores, Inc. is a leading specialty retailer of children's merchandise, ages newborn to ten years old. The Company designs, contracts to manufacture and sells high quality, value-priced apparel and accessories under the “The Children's Place” brand name. As of November 27, 2004, the Company operated 747 Children's Place stores, including 689 stores in the United States, 55 stores in Canada and three stores in Puerto Rico. The Company also sells Children's Place merchandise through its virtual store, www.childrensplace.com. In November 2004, the Company acquired the subsidiary which operates the business of the Disney Stores in North America, which consists of 298 stores in the United States and 15 stores in Canada.

About ProfitLogic
ProfitLogic provides an industry-leading suite of Merchandise Optimization solutions designed for retailers whose priority is getting the highest return on inventory investments. ProfitLogic's solutions provide merchants with day-to-day operational decision support and workflow for making better-informed assortment execution, allocation and fashion replenishment, promotion, pricing and markdown decisions. ProfitLogic has delivered fast, flexible solutions with significant financial benefit to industry leading retailers such as American Eagle Outfitters, AnnTaylor, Bloomingdale's, Charming Shoppes, Gap Inc., including: Gap, Banana Republic, Old Navy; JCPenney, Lerner New York, Marshall Field's, Meijer Stores, Northern Group Retail, Sears, ShopKo Stores, Target Stores and Toys R Us. For more information about Cambridge, Mass.-based ProfitLogic, call 617-218-1900 or visit www.profitlogic.com.

Contact:
Jakki Glivicky
ProfitLogic
617-374-5959
jglivicky@profitlogic.com