Neiman Marcus 2014 Annual Report Download - page 13

Table of Contents

For more information about our business, financial condition and results of operations, see Item 7, "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and our Consolidated Financial Statements and the related notes thereto contained in Item 15.
We also make our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and related amendments, available
free of charge through our website at www.neimanmarcusgroup.com as soon as reasonably practicable after we electronically file such material with (or
furnish such material to) the Securities and Exchange Commission (the SEC). The information contained on our website is not incorporated by reference into
this Annual Report on Form 10-K and should not be considered to be part of this Annual Report on Form 10-K.
Copies of the reports and other information we file with the SEC may also be examined by the public without charge at 100 F Street, N.E., Room
1580, Washington D.C., 20549, or on the internet at http://sec.gov. Copies of all or a portion of such materials can be obtained from the SEC upon payment
of prescribed fees. Please call the SEC at 1-800-SEC-0330 for further information.


Economic conditions may negatively impact consumer spending and demand for our merchandise.
We sell luxury retail merchandise. Purchases of merchandise by our customers are discretionary, and therefore highly dependent upon the level of
consumer spending, particularly among affluent customers. A number of factors affect the level of consumer spending on our merchandise, and in turn our
revenues and comparable revenues, including:
• general economic and industry conditions, including inflation, deflation, changes related to interest rates, rates of economic growth, current and
expected unemployment levels and government fiscal and monetary policies;
• the performance of the financial, equity and credit markets;
• consumer disposable income levels, consumer confidence levels, the availability, cost and level of consumer debt and consumer behaviors
towards incurring and paying debt;
• changes in prices for commodities and energy, including fuel; and
• current and expected tax rates and policies.
During an actual or perceived economic downturn, fewer customers may shop with us and those who do shop may limit the dollar amounts or
quantities of their purchases. Deterioration in domestic and global economic conditions leading to reductions in consumer spending have had a significant
adverse impact on our business in the past. While economic conditions have improved since the severe downturn we experienced in calendar years 2008 and
2009, domestic and global economic conditions remain volatile, and there can be no assurance that the economy will continue to improve. The recurrence of
adverse economic conditions could have an adverse effect on our business, financial condition and results of operations.
If we fail to anticipate, identify and respond effectively to changing consumer demands, fashion trends and consumer shopping preferences, our business,
financial condition and results of operations may be adversely affected.
Our success depends in large part on our ability to identify fashion trends and consumer shopping preferences, and to anticipate, identify and react
effectively to rapidly changing consumer demands in a timely manner. We make decisions regarding the purchase of our merchandise well in advance of the
season in which it will be sold. For example, women’s apparel, men’s apparel, shoes and handbags are typically ordered six to nine months in advance of the
date the merchandise will be offered for sale, while jewelry and other categories are typically ordered three to six months in advance of such date.
If our sales during any season are significantly lower than we anticipated, we may not be able to adjust our expenditures for inventory and other
expenses in a timely fashion and may be left with unsold inventory. If that occurs, we may be forced to rely on markdowns or promotional sales to dispose of
excess inventory, which could have an adverse effect on our gross margins and results of operations. Conversely, if we fail to purchase a sufficient quantity of
merchandise, we may not have an adequate supply of merchandise to meet consumer demand, thereby causing us to lose sales opportunities or adversely
12