Columbia Sportswear 2003 Annual Report Download - page 13

fluctuations. In particular, we must continually monitor import requirements and transfer production as necessary
to lessen the potential impact from increased tariffs or quota restrictions that may be periodically imposed.
We have from time to time experienced difficulty satisfying our raw material and finished goods
requirements, and any similar future difficulties could adversely affect our business operations. Our three largest
factory groups accounted for approximately 16% of our total global production for 2003. Another company
produces substantially all of the zippers used in our products. In both instances, however, these companies have
multiple factory locations, many of which are in different countries, which reduces the risk that unfavorable
conditions at a single factory or location will have a material adverse effect on our business.
Sales and Distribution
Our products are sold to approximately 12,000 specialty and department store retailers throughout the
world. Our strategy for continued growth is to focus on:
• enhancing the productivity of existing retailers;
• expanding distribution in international markets;
• further developing the existing merchandise categories; and
• increasing our penetration into the department store and specialty footwear channels.
The following table presents the net sales to unrelated entities and approximate percentages of net sales by
geographic region for each of the last three years (dollars in millions):
2003 2002 2001
Net Sales % of Sales Net Sales % of Sales Net Sales % of Sales
United States ............................ $596.8 62.7% $557.5 68.3% $551.3 70.7%
Canada ................................ 106.7 11.2 86.7 10.6 81.3 10.4
Europe................................. 135.2 14.2 95.9 11.8 82.3 10.6
Other international (1) .................... 113.1 11.9 76.2 9.3 64.7 8.3
Total .............................. $951.8 100.0% $816.3 100.0% $779.6 100.0%
(1) Includes direct sales in Japan, Korea and to third-party distributors in Europe and elsewhere.
See Note 16 of Notes to Consolidated Financial Statements for net sales, income before income tax,
identifiable assets, interest expense, and depreciation and amortization by geographic segment.
North America
Approximately 39.7% of the retailers that offer our products worldwide are located in the United States and
Canada. The sales in these two countries amounted to 73.9% of our total revenues for 2003. We work with over
30 independent sales agencies that in turn work with retail accounts varying in size from single specialty store
operations to large chains made up of many stores in several locations.
Mountain Hardwear products are sold through 10 independent sales agencies that work with a variety of
retail accounts that are primarily focused on smaller specialty outdoor and ski shops across the United States.
Mountain Hardwear products are also sold through select specialty chain stores and catalog companies that
feature high end outdoor equipment and apparel. In Canada, Mountain Hardwear products are sold through an
independent distributor in Canada.
Our flagship store in Portland, Oregon is designed to create a distinctive “Columbia” environment,
reinforcing the active and outdoor image of the Columbia brand. In addition, this store provides us with the
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