Lumber Liquidators 2012 Annual Report Download - page 16

Bamboo, Cork and Resilient. Our proprietary bamboo products, harvested from the fast growing bamboo plant, are
offered as a prefinished, natural or stained, solid or engineered floor. Our proprietary cork flooring is produced by harvesting
the outer bark of the cork oak tree, and it is durable, acoustical and acts as an insulator. Produced from recycled materials,
our resilient flooring planks come in realistic wood and tile looks, are water-resistant, highly durable and install with
“peel-and-stick” or click-together ease. Our bamboo, cork and resilient flooring products carry wear warranties ranging from
10 to 50 years.
Our Employees
As of December 31, 2012, we had 1,420 employees, 96% of whom were full-time and none of whom were represented
by a union. Of these employees, 70% work in our stores, 17% work in corporate store support infrastructure or similar
functions (including our call center employees) and 13% work either on our finishing line or in our distribution centers. We
believe that we have good relations with our employees.
Seasonality and Quarterly Results
Our quarterly results of operations fluctuate depending on the timing of our advertising expenses and the timing of, and
income contributed by, our new stores. Our net sales also fluctuate slightly as a result of seasonal factors. We experience
slightly higher net sales in spring and fall, when more home remodeling activities are taking place, and slightly lower net
sales in holiday periods and during the hottest summer months. These seasonal fluctuations, however, are minimized to some
extent by our national presence, as markets experience different seasonal characteristics.
Intellectual Property and Trademarks
We have a number of marks registered in the United States, including Lumber Liquidators®, Bellawood®, 1-800-
HARDWOOD®, 1-800-FLOORING®, Dura-Wood®, Quickclic®, Virginia Mill Works Co. Hand Scraped and Distressed
Floors®, Morning Star Bamboo Flooring®, Dream Home Laminate Floors®, Builder’s Pride®, Schön Engineered Floors®,
Casa de Colour Collection®and other product line names. We have also registered certain marks in jurisdictions outside the
United States, including the European Union, Canada, China, Australia and Japan. We regard our intellectual property as
having significant value and these names are an important factor in the marketing of our brands. Accordingly, we take steps
intended to protect our intellectual property including, where necessary, the filing of lawsuits and administrative actions to
enforce our rights. We are not aware of any facts that could be expected to have a material adverse effect on our intellectual
property.
Government Regulation
We are subject to extensive and varied federal, provincial, state and local government regulation in the jurisdictions in
which we operate, including laws and regulations relating to our relationships with our employees, public health and safety,
zoning and fire codes. We operate each of our stores, offices, finishing facility and distribution centers in accordance with
standards and procedures designed to comply with applicable laws, codes and regulations.
Our operations and properties are also subject to federal, provincial, state and local laws and regulations relating to the
use, storage, handling, generation, transportation, treatment, emission, release, discharge and disposal of hazardous materials,
substances and wastes and relating to the investigation and cleanup of contaminated properties, including off-site disposal
locations. We do not incur significant costs complying with environmental laws and regulations. However, we could be
subject to material costs, liabilities or claims relating to environmental compliance in the future, especially in the event of
changes in existing laws and regulations or in their interpretation.
Our suppliers are subject to the laws and regulations of their home countries, including in particular laws regulating
labor, forestry and the environment. We consult with our suppliers as appropriate to ensure that they are in compliance with
their applicable home country laws. We also support social and environmental responsibility among our supplier community
and our suppliers agree to comply with our expectations concerning environmental, labor and health and safety matters.
Those expectations include representations and warranties that our suppliers comply with the laws, rules and regulations of
the countries in which they operate.
Products that we import into the United States and Canada are subject to laws and regulations imposed in conjunction
with such importation, including those issued and/or enforced by U.S. Customs and Border Protection and the Canadian
Border Services Agency. In addition, certain of our products are subject to laws and regulations relating to the importation,
acquisition or sale of illegally harvested plants and plant products and the emissions of hazardous materials. We work closely
with our suppliers to ensure compliance with the applicable laws and regulations in these areas.
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