Family Dollar 2011 Annual Report Download - page 19

kind, we could be exposed to negative publicity, government enforcement actions, private litigation, or costly
response measures. In addition, our reputation within the business community and with our customers may be
affected, which could result in our customers discontinuing the use of debit or credit cards in our stores, or not
shopping in our stores altogether. This could cause us to lose market share to our competitors and could have an
adverse effect on our financial results.
Inability to attract and retain qualified employees, particularly field, store and distribution center managers, and
to control labor costs, could adversely affect our business.
Our growth could be adversely impacted by our inability to attract and retain qualified employees at the
store operations level, in distribution facilities, and at the corporate level, at costs which allow us to profitably
conduct our operations. For example, we believe that the retention of managers at the store level is one factor in
reducing inventory shrinkage resulting from employee theft. Various other factors, such as overall labor
availability, wage rates, union organizing activity, regulatory or legislative impacts, and various benefit costs
could all impact our ability to attract and retain employees negatively and may affect our results of operations
adversely.
Our success depends on our executive officers and other key personnel. If we lose key personnel or are unable to
hire additional qualified personnel, our business could be harmed.
Our future success depends to a significant degree on the skills, experience and efforts of our executive
officers and other key personnel. The loss of the services of any of our executive officers could have an adverse
effect on our operations. Our future success will also depend on our ability to attract and retain qualified
personnel, as a failure to attract these key personnel could have an adverse effect on our operations. We do not
currently maintain key person life insurance policies with respect to our executive officers or key personnel.
Our business is slightly seasonal, and adverse events during the holiday season could impact our operating
results negatively.
Our business is slightly seasonal, with the highest percentage of sales (approximately 27% of total annual
sales over the last five fiscal years) occurring during the second fiscal quarter (December, January, and
February). We purchase significant amounts of seasonal inventory in anticipation of the holiday season. Adverse
events, such as deteriorating economic conditions, higher unemployment, higher gas prices, public transportation
disruptions, or unusual weather could result in lower-than-planned sales during the holiday season. This could
lead to lower sales or to unanticipated markdowns, negatively impacting our financial condition and results of
operations.
We are exposed to the risk of natural disasters, unusual weather, pandemic outbreaks, global political events,
war, and terrorism that could disrupt business and result in lower sales, increased operating costs and capital
expenditures.
Our headquarters, store locations and distribution centers, as well as certain of our vendors and customers,
are located in areas which could be subject to natural disasters such as floods, hurricanes, tornadoes or
earthquakes. Adverse weather conditions or other extreme changes in the weather, including resulting electrical
and technological failures, may disrupt our business and may adversely affect our ability to sell and distribute
products. In addition, we operate in markets that may be susceptible to pandemic outbreaks, war, terrorist acts or
disruptive global political events, such as civil unrest in countries from which our suppliers are located. Our
business may be harmed if our ability to sell and distribute products is impacted by any such events, any of
which could influence customer trends and purchases and may negatively impact our net sales, properties or
operations. Such events could result in physical damage to one or more of our properties, the temporary closure
of some or all of our stores or distribution centers, the temporary lack of an adequate work force in a market,
temporary or long-term disruption in the transport of goods, delay in the delivery of goods to our distribution
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