Banana Republic 2010 Annual Report Download - page 15

Trademarks and Service Marks
Gap, GapKids, babyGap, GapBody, Banana Republic, Old Navy, Piperlime, and Athleta trademarks and service
marks, and certain other trademarks, have been registered, or are the subject of pending trademark applications,
with the United States Patent and Trademark Office and with the registries of many foreign countries and/or are
protected by common law.
Franchising
We have franchise agreements with unaffiliated franchisees to operate Gap and/or Banana Republic stores in a
number of countries, including Australia, Bahrain, Bulgaria, Chile, Croatia, Cyprus, Egypt, Greece, Indonesia, Israel,
Jordan, Kazakhstan, Kuwait, Malaysia, Mexico, Oman, Philippines, Qatar, Romania, Russia, Saudi Arabia, Singapore,
South Korea, Thailand, Turkey, and United Arab Emirates. Under these agreements, third parties operate, or will
operate, stores that sell apparel and related products under our brand names. We continue to increase the number
of countries in which we enter into these types of arrangements as part of our efforts to expand internationally.
For additional information on risks related to our franchise business, see the section entitled “Risk Factors—Our
efforts to expand internationally may not be successful and could impair the value of our brands” in Item 1A of this
Form 10-K.
Inventory
The cyclical nature of the retail business requires us to carry a significant amount of inventory, especially prior to
peak selling seasons when we, along with other retailers, generally build up inventory levels. We review our
inventory levels in order to identify slow-moving merchandise and broken assortments (items no longer in stock in
a sufficient range of sizes) and use markdowns to clear merchandise. As we do not carry much replenishment
inventory in our stores, much of our inventory is maintained in distribution centers. Also see the section entitled
“Risk Factors—We must successfully gauge fashion trends and changing consumer preferences to succeed” in
Item 1A of this Form 10-K.
Competitors
The global specialty apparel retail industry is highly competitive. We compete with local, national, and global
department stores, specialty and discount store chains, independent retail stores, and online businesses that
market similar lines of merchandise. We are also faced with competition in European, Japanese, Chinese, and
Canadian markets from established regional and national chains, and our franchisees face significant competition
in the markets in which they operate. Also see the section entitled “Risk Factors—Our business is highly
competitive” in Item 1A of this Form 10-K.
Employees
As of January 29, 2011, we had a work force of approximately 134,000 employees, which includes a combination
of part- and full-time employees. We hire seasonal employees primarily during the peak holiday period.
To remain competitive in the apparel retail industry, we must attract, develop, and retain skilled employees,
including executives. Competition for such personnel is intense. Our success is dependent to a significant degree
on the continued contributions of key employees. Also see the section entitled “Risk Factors—We must successfully
gauge fashion trends and changing consumer preferences to succeed” in Item 1A of this Form 10-K.
Available Information
We make available on our website, gapinc.com, under “Investors, Financial Information, SEC Filings,” free of charge,
our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to
those reports as soon as reasonably practicable after we electronically file or furnish them to the U.S. Securities and
Exchange Commission (“SEC”).
8Gap Inc. Form 10-K