DSW 2013 Annual Report Download - page 7

Table of Contents
On October 14, 2013, the shareholders of DSW approved a two-for-one stock split of DSW's Common Shares. The stock split became effective on
November 4, 2013 and provided for the issuance of one Class A Common Share for each Class A and Class B Common Share outstanding.
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We believe our leading market position is driven by our competitive strengths: the breadth of our branded product offerings, our relationships with
merchandise suppliers, our distinctive and convenient shopping experience and the value proposition offered to our customers.
The Breadth of Our Product Offerings
Our goal is to excite our customers with an assortment of shoes that fulfill a broad range of style and fashion preferences. DSW stores and dsw.com sell a large
assortment of brand name, designer and private brand merchandise. We purchase directly from approximately 500 domestic and foreign vendors, primarily
in-season footwear found in specialty and department stores and branded make-ups (shoes made exclusively for a retailer). A typical DSW store carries
approximately 23,000 pairs of shoes in approximately 1,600 styles compared to a significantly smaller product offering at department stores. We also offer a
complementary assortment of handbags, hosiery, jewelry and other accessories which appeal to our brand and fashion conscious customers.
Our Relationships with Merchandise Suppliers
We believe we have strong relationships with our vendors. We purchase merchandise directly from approximately 500 domestic and foreign vendors. Our
vendors include suppliers who either manufacture their own merchandise or supply merchandise manufactured by others, or both. Most of our domestic
vendors import a large portion of their merchandise from abroad. We have quality control programs under which our DSW buyers are involved in establishing
standards for quality and fit, and our store personnel examine incoming merchandise in regards to color, material and overall quality. As our sales volumes
continue to grow, we believe there will continue to be adequate sources available to acquire a sufficient supply of quality goods in a timely manner and on
satisfactory economic terms. During fiscal 2013, 2012 and 2011, merchandise supplied by our top three vendors accounted for approximately 19%, 18% and
19% of our net sales, respectively.
We separate our DSW merchandise into four primary categories: women’s footwear; men’s footwear; athletic footwear; and accessories and other. While shoes
are the main focus of DSW, we also offer a complementary assortment of handbags, hosiery, jewelry and other accessories. The following table sets forth the
approximate percentage of our sales attributable to each merchandise category for the fiscal years below:
Fiscal years ended
Category
February 1, 2014
February 2, 2013
January 28, 2012
Women's
62%
65%
66%
Men's
17%
16%
15%
Athletic
12%
12%
12%
Accessories and Other
9%
7%
7%
Our Distinctive and Convenient Shopping Experience
We provide our customers with the highest level of convenience based on our belief that customers should be empowered to control and personalize their
shopping experiences. In stores, our merchandise is displayed on the selling floor with self-service fixtures to enable customers to view and touch the
merchandise. We believe this shopping experience provides our customers with maximum convenience as they are able to browse and try on merchandise
without feeling rushed or pressured to make a purchasing decision. We also provide our customers with shopping experiences through dsw.com and our
mobile site by offering additional styles, sizes, widths and categories. Merchandise in our stores and on dsw.com is organized in a logical manner that groups
together similar styles such as dress, casual, seasonal and athletic merchandise for easy browsing.
Over the past two years, we have taken important steps in our omni-channel strategy with the launch of our shoephoria, charge-send and drop ship
capabilities. Our shoephoria system provides us the ability to fulfill out-of-stock orders placed within our stores out of our fulfillment center. Our charge-send
system allows us to fulfill both online and store orders from all of our DSW store locations. Charge-send is now available in all DSW stores. Our drop ship
capability allows us to sell product online
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Source: DSW Inc., 10-K, March 27, 2014 Powered by Morningstar® Document Research℠
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