Lumber Liquidators 2015 Annual Report Download - page 18

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protection, privacy, zoning and occupancy matters as well as the operation of retail stores and warehouse,
production and distribution facilities and provision of installation services. In addition, various federal,
provincial and state laws govern our relationship with and other matters pertaining to our employees,
including wage and hour laws, requirements to provide meal and rest periods or other benefits, health care
insurance issues, minimum wage standards, family leave mandates, requirements regarding working conditions
and accommodations to certain employees, citizenship or work authorization and related requirements,
insurance and workers’ compensation rules and anti-discrimination laws. If we fail to comply with these laws
and regulations, we could be subject to legal risk, our operations could be impacted negatively and our
reputation could be damaged. Likewise, if such laws and regulations should change, including labor laws that
impact exempt status and overtime eligibility, our costs of compliance may increase, thereby impacting our
results and hurting our profitability.
Certain portions of our operations are subject to laws and regulations governing the use, storage,
handling, generation, treatment, emission, release, discharge and disposal of certain hazardous materials and
wastes, the remediation of contaminated soil and groundwater and the health and safety of employees. If we
are unable to comply with, extend or renew a material approval, license or permit required by such laws, or if
there is a delay in renewing any material approval, license or permit, our net sales and operating results could
deteriorate or otherwise cause harm to our business.
With regard to our products, we may spend significant time and resources in order to comply with
applicable advertising, importation, exportation, environmental, health and safety laws and regulations. If we
should violate these laws and regulations, we could experience delays in shipments of our goods, be subject to
fines, penalties, criminal charges, or other legal risks, be liable for costs and damages, or suffer reputational
harm, which could reduce demand for our merchandise and hurt our business and results of operations.
Further, if such laws and regulations should change, we may experience increased costs or incur decreased
efficiency in order to adhere to the new standards.
Our growth strategy is impacted by our ability to open new stores and is subject to many unpredictable
factors.
As of December 31, 2015, we had 374 stores throughout the United States and Canada, 152 of which we
opened after January 1, 2011. Assuming the continued success of our store model and satisfaction of our
internal criteria, we plan to open a significant number of new stores over the next several years. This growth
strategy and the investment associated with the development of each new store may cause our operating
results to fluctuate and be unpredictable or decrease our profits. Our future results and ability to implement
our growth strategy will depend on various factors, including the following:
• our ability to maintain our reputation of providing safe, compliant products;
• consumer recognition of the quality of our products;
• the successful resolution of the various pending government investigations and legal proceedings;
• the successful selection of new markets and store locations;
• the implementation of and results generated by our new showroom format;
• our ability to negotiate leases on acceptable terms;
• management of store opening costs;
• the quality of our operations;
• our ability to meet customer demand;
• the continued popularity of hardwood flooring;
• our cash flow, access to capital and business condition; and
• general economic conditions.
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