CDW 2014 Annual Report Download - page 14

Table of Contents
We expect the competitive landscape in which we compete to continue to change as new technologies are developed. While innovation
can help our business as it creates new offerings for us to sell, it can also disrupt our business model and create new and stronger competitors.
For instance, while cloud-based solutions present an opportunity for us, cloud-based solutions and technologies that deliver technology solutions
as a service could increase the amount of sales directly to customers rather than through solutions providers like us, or could reduce the amount
of hardware we sell, leading to a reduction in our sales and/or profitability. In addition, some of our hardware and software vendor partners sell,
and could intensify their efforts to sell, their products directly to our customers. Moreover, traditional OEMs have increased their services
capabilities through mergers and acquisitions with service providers, which could potentially increase competition in the market to provide
comprehensive technology solutions to customers. If any of these trends becomes more prevalent, it could adversely affect our business, results
of operations or cash flows.
We focus on offering a high level of service to gain new customers and retain existing customers. To the extent we face increased
competition to gain and retain customers, we may be required to reduce prices, increase advertising expenditures or take other actions which
could adversely affect our business, results of operations or cash flows. Additionally, some of our competitors may reduce their prices in an
attempt to stimulate sales, which may require us to reduce prices. This would require us to sell a greater number of products to achieve the same
level of net sales and gross profit. If such a reduction in prices occurs and we are unable to attract new customers and sell increased quantities of
products, our sales growth and profitability could be adversely affected.
The success of our business depends on the continuing development, maintenance and operation of our information technology systems.
Our success is dependent on the accuracy, proper utilization and continuing development of our information technology systems,
including our business systems, such as our sales, customer management, financial and accounting, marketing, purchasing, warehouse
management, e-commerce and mobile systems, as well as our operational platforms, including voice and data networks and power systems. The
quality and our utilization of the information generated by our information technology systems, and our success in implementing new systems
and upgrades, affects, among other things, our ability to:
The integrity of our information technology systems is vulnerable to disruption due to forces beyond our control. While we have taken
steps to protect our information technology systems from a variety of threats, including computer viruses, malware, phishing, social engineering,
unauthorized access and other malicious attacks, both internal and external, and human error, there can be no guarantee that those steps will be
effective. Furthermore, although we have redundant systems at a separate location to back up our primary systems, there can be no assurance that
these redundant systems will operate properly if and when required. Any disruption to or infiltration of our information technology systems
could significantly harm our business and results of operations.
Breaches of data security could adversely impact our business.
11
• resellers, such as Dimension Data, ePlus, Insight Enterprises, PC Connection, PCM, Presidio, Softchoice, World Wide Technology and
many smaller resellers;
• manufacturers who sell directly to customers, such as Dell, Hewlett-
Packard and Apple;
• large service providers and system integrators, such as IBM, Accenture, Hewlett-
Packard and Dell;
• e-
tailers, such as Amazon, Newegg and TigerDirect.com;
•
cloud providers, such as AT&T, Amazon Web Services and Box; and
• retailers (including their e-
commerce activities), such as Staples and Office Depot.
•
conduct business with our customers, including delivering services and solutions to them;
•
manage our inventory and accounts receivable;
• purchase, sell, ship and invoice our hardware and software products and provide and invoice our services efficiently and on a timely
basis; and
• maintain our cost-
efficient operating model while scaling our business.