GameStop 2014 Annual Report Download - page 38

entertainment centers. Our Technology Brands stores compete with awide variety of other wireless carriers and retailers and
consumer electronics retailers, including AT&T,which competes with our Spring Mobile managed AT &T and Cricket Wireless
branded stores. If we lose customers to our competitors, or if we reduce our prices or increase our spending to maintain our
customers, we may be less profitable.
We depend upon our key personnel and they would be difficult to replace.
Our success depends upon our ability to attract, motivate and retain ahighlytrained and engaged workforce, including key
management for our stores and skilled merchandising, marketing, financial and administrative personnel. The turnover rate in the
retail industry is relatively high, and there is an ongoing need to recruit and train new store employees. Factors that affect our
ability to maintain sufficient numbers of qualified employees include employee morale, our reputation, unemployment rates,
competition from other employers and our ability to offer appropriate compensation packages. Additionally,wedepend upon the
continued services of our key executive officers, including our Executive Chairman, Chief Executive Officer,Chief Operating
Officer and Executive Vice Presidents. Our inability to recruit asufficient number of qualified individuals or our failure to retain
key employees in the future may have anegative impact on our business.
International events could delay or prevent the delivery of products to our suppliers.
Our suppliers rely on foreign sources, primarily in Asia, to manufacture aportion of the products we purchase from them. As
aresult, any event causing adisruption of imports, including natural disasters or the imposition of import restrictions or trade
restrictions in the form of tariffs or quotas, could increase the cost and reduce the supply of products available to us, which could
lower our salesand profitability.
Our international operations expose us to numerous risks.
We have international retail operations in Australia, Canada and Europe. Because release schedules for hardware and software
introduction in these markets can sometimes differ from release schedules in the United States, the timing of increases and decreases
in foreign sales may differ from the timing of increases and decreases in domestic sales. We are also subject to anumberofother
factors that may affect our current or future international operations. These include:
•economic downturns, specifically in the regions in which we operate;
•currency exchange rate fluctuations;
•international incidents;
•natural disasters;
•government instability; and
•competitors entering our current and potential markets.
Our operations in Europe are also subject to risks associated with the current economic conditions and uncertainties in the
European Union (“EU”). European and global economic conditions have already been negatively impacted by the ability of certain
EU member states to service their sovereign debt obligations. Additionally,there continues to be uncertainty over the possibility
that other EU member states may experience similar financial troubles, the ultimate outcome of the EU governments’ financial
supportprograms, the possible breakup or restructuring of the EU and the possible elimination or restructuring of the EU monetary
system. These continued uncertainties could further disrupt European and global economic conditions. Unfavorable economic
conditions could negatively impact consumer demand for our products. These factors could have an adverse effect on our business,
results of operations and financial condition.
We arealso subject to risks that our operations outside the United States could be conducted by our employees, contractors,
representatives or agents in ways that violate the Foreign Corrupt Practices Act or other similar anti-bribery laws. While we have
policies and procedures intended to ensure compliance with these laws, our employees, contractors, representativesand agents
maytake actions that violate our policies. Moreover,itmay be more difficult to oversee the conduct of any such persons who are
not our employees, potentially exposing us to greater risk from their actions. Any violations of those laws by any of those persons
could have anegative impact on our business.
Unfavorable changes inour globaltax rate could have anegative impact on our business, results of operations and cash
flows.
As aresult of our operations in many foreign countries, our global tax rate is derived from acombination of applicabletax
rates in the various jurisdictions in which we operate. Depending upon the sources of our income, any agreements we may have
with taxing authorities in various jurisdictions and the tax filing positions we take in various jurisdictions, our overall tax rate may
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