Harris Teeter 2001 Annual Report Download - page 6

a&e: responding to global opportunities | Consumer demand for apparel and other textile products
fell significantly below last year’s already depressed levels and production throughout the industry
continued to move overseas to low labor cost regions. Management at A&E proactively addressed this
problem by focusing on identifying those areas where we can benefit from our competitive advantages.
That meant continuing our development overseas and reorganizing our operations here at home to
better reflect the changing business environment. We also adjusted production to match demand
through plant closings and job reductions in the United States and increased our already significant
presence overseas. The highlight was the completion of our new facility in China.
harris teeter: focusing on core markets | For Harris Teeter, this meant exiting several non-core mar-
kets including Atlanta. After a strategic review of each market’s performance, we concluded that a sale
of our stores in these areas was a prudent business decision that will substantially strengthen the com-
pany’s overall performance. Capital can now be committed to our core markets, those which have con-
sistently generated attractive levels of profitability and which, we believe, offer the greatest potential for
long-term return on capital and increased shareholder value.
We are now better able to emphasize our core markets and core constituencies. We know who our
customers are and how we can deliver the services and products that they want and need, efficiently
and profitably.
Harris Teeter’s goals this year included driving sales and customer visits. To that end, we used our
Very Important Customer (“VIC”) card program to identify our loyal customers and provide them with
incentives to shop regularly at Harris Teeter. This program also provides us with information as to how
to better provide customers the service they expect through better product lines. Despite the economy
and the competitive environment, we were extremely successful at driving business, and our stores
that were open for all of 2000 and 2001 enjoyed a 2.8% increase in average sales.
Thomas W. Dickson
President
John Woodlief
Vice President – Finance
Alan T. Dickson
Chairman of the Board
R. Stuart Dickson
Chairman of the
Executive Committee