CarMax 2004 Annual Report Download - page 16

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14
CARMAX 2004
GROWTH PLAN
■By focusing on used cars, CarMax can grow organically,
unrestrained by new car franchise or manufacturer
restrictions.
■We resumed our growth plan at the end of fiscal 2002,
following a two-year hiatus during which we concentrated
on improving sales and profits. We opened two superstores
in fiscal 2002, five superstores in fiscal 2003, and nine
superstores in fiscal 2004, including a replacement store
in Los Angeles.
■During the next three years, we plan to open stores at an
annual rate of approximately 15%-20% of our used car
superstore base, focusing primarily on new mid-sized
markets and adding satellite stores in established markets.
■We define mid-sized markets as those with television
viewing populations ranging from 1 million to
2.5 million. These markets are the easiest to enter
from a real estate and advertising perspective, and
historically they are where we have experienced the
fastest store ramp-up and profitability.
■Satellite stores are being added in under-served trade areas
in established multi-store markets and to increase
penetration and market share in established mid-sized
markets. Satellite stores are highly efficient because they
are built on smaller sites and require little or no
incremental advertising.
■In fiscal 2005, we expect to open 10 superstores,
including four standard stores in mid-sized markets, four
satellite stores in established markets, and two additional
stores in Los Angeles. The L.A. stores will help provide
the foundation for an eventual full-market rollout.
6
SOLID GROWTH
OPPORTUNITY
STORE EXPANSION
(Number of used car superstores)
FY94
12
4
7
18
29
33
35
FY95 FY96 FY97 FY98 FY99 FY00 FY01 FY02
40
FY03
33
49
FY04 FY05 FY06 FY07