Abercrombie & Fitch 2008 Annual Report Download - page 9

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Table of Contents
COMPETITION.
The sale of apparel and personal care products through brick-and-mortar stores and
direct-to-consumer channels is a highly competitive business with numerous participants, including
individual and chain fashion specialty stores, as well as regional and national department stores. As the
Company continues its international expansion, it will also face competition in European, Asian and other
international markets from established regional and national chains, as well as specialty stores. Brand
recognition, fashion, price, service, store location, selection and quality are the principal competitive
factors in retail store and direct-to-consumer sales.
The competitive challenges facing the Company include anticipating and quickly responding to
changing fashion trends; and maintaining the aspirational positioning of its brands so it can sustain its
premium pricing position. Furthermore, the Company faces additional competitive challenges as many
retailers increase promotional activity as a result of current economic conditions, while the Company’s
policy continues to be not to engage in promotional activities that the Company believes could diminish
the value of the brands.
ASSOCIATE RELATIONS.
As of March 20, 2009, the Company employed approximately 83,000 associates, none of whom were
party to a collective bargaining agreement. Approximately 73,000 of these associates were part-time
employees.
On average, the Company employed approximately 22,000 full-time equivalents during Fiscal 2008
which included approximately 13,000 full-time equivalents comprised of part-time employees, including
temporary associates hired during peak periods, such as the Back-to-School and Holiday seasons.
The Company believes it maintains a good relationship with its associates. However, in the normal
course of business, the Company is party to lawsuits involving former and current associates. Refer to
“ITEM 3. LEGAL PROCEEDINGS” in this Annual Report on Form 10-K.
ITEM 1A. RISK FACTORS.
FORWARD-LOOKING STATEMENTS AND RISK FACTORS.
The Company cautions that any forward-looking statements (as such term is defined in the Private
Securities Litigation Reform Act of 1995) contained in this Annual Report on Form 10-K or made by the
Company, its management or spokespeople involve risks and uncertainties and are subject to change
based on various factors, many of which may be beyond the Company’s control. Words such as
“estimate,” “project,” “plan,” “believe,” “expect,” “anticipate,” “intend” and similar expressions may
identify forward-looking statements. Except as may be required by applicable law, the Company assumes
no obligation to publicly update or revise its forward-looking statements.
The following factors could affect the Company’s financial performance and could cause actual
results to differ materially from those expressed or implied in any of the forward-looking statements:
• effects of the current financial crisis and general economic conditions which impact consumer
confidence and purchases and the level of consumer discretionary spending;
• effects of changes in the U.S. credit and lending market conditions;
• loss of services of skilled senior executive officers;
7
Source: ABERCROMBIE & FITCH CO /DE/, 10-K, March 27, 2009 Powered by Morningstar® Document Research℠