Columbia Sportswear 2013 Annual Report Download - page 18

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production and delivery, and diminish our ability to build brand loyalty. Shipments delayed due to limited factory capacity
or other factors could result in order cancellations by our customers, which could have a material adverse effect on our
financial condition, results of operations or cash flows.
We May be Adversely Affected by Weather Conditions, Including Global Climate Change Trends
Our business is adversely affected by unseasonable weather conditions. A significant portion of the sales of our
products is dependent in part on the weather and likely to decline in years in which weather conditions do not stimulate
demand for our products. Periods of unseasonably warm weather in the fall or winter or unseasonably cold or wet weather
in the spring and summer may have a material adverse effect on our financial condition, results of operations or cash flows.
Unintended inventory accumulation by our wholesale customers resulting from unseasonable weather in one season generally
negatively affects orders in future seasons, which may have a material adverse effect on our financial condition, results of
operations or cash flows.
A significant portion of our business is highly dependent on cold-weather seasons and patterns to generate consumer
demand for our cold-weather apparel and footwear. Consumer demand for our cold-weather apparel and footwear may be
negatively affected to the extent global weather patterns trend warmer, reducing typical patterns of cold-weather events, or
increasing weather volatility, which could have a material adverse effect on our financial condition, results of operations
or cash flows.
We May Not Succeed in Realizing the Anticipated Benefits of Our New Joint Venture in China
Effective January 2014, our joint venture in China with Swire Resources Limited ("Swire") began operations. The
joint venture, in which we hold a 60% interest, is subject to a number of risks and uncertainties, including the following:
• Our ability to operate the joint venture will be dependent upon, among other things, our ability to attract and
retain personnel with the skills, knowledge and experience necessary to carry out the operations of the joint
venture. Approximately 600 employees working with or for Swire became employees of, or provide services
to, the joint venture. Our ability to effectively operate the joint venture will depend upon our ability to manage
the employees of the joint venture, and to attract new employees as necessary to supplement the skills, knowledge
and expertise of the existing management team and other key personnel. We face intense competition for these
individuals worldwide, including in China. We may not be able to attract qualified new employees or retain
existing employees to operate the joint venture. Additionally, turnover in key management positions in China
could impair our ability to execute our growth strategy, which may negatively affect the value of our investment
in the joint venture and the growth of our sales in China.
• Initially, we are relying in part on the operational skill of our joint venture partner. Additionally, because our
joint venture partner has protective voting rights with respect to certain major business decisions of the joint
venture, we may experience difficulty reaching agreement as to implementation of certain changes to the joint
venture’s business. For these reasons, or as a result of other factors, we may not realize the anticipated benefits
of the joint venture, and our participation in the joint venture could adversely affect the results of our operations.
• Continued sales growth in China is an important part of our expectations for our joint venture business. Although
China has experienced significant economic growth in recent years, that growth is slowing. Slowing economic
growth in China could result in reduced consumer discretionary spending, which in turn could result in less
demand for our products, and thus negatively affect the value of our investment in the joint venture and the
growth of our sales in China.
• Although we believe we have achieved a leading market position in China, many of our competitors who are
significantly larger than we are and have substantially greater financial, distribution, marketing and other
resources, more stable manufacturing resources and greater brand strength are also concentrating on growing
their businesses in China. In addition, the number of competitors in the marketplace has increased significantly
in recent years. Increased investment by our competitors in this market could decrease our market share and
competitive position in China.
Our International Operations Involve Many Risks