Nordstrom 2015 Annual Report Download - page 5

COMPETITIVE CONDITIONS
We operate in a highly competitive business environment. We compete with other national, regional, local and online retailers that may carry
similar lines of merchandise, including department stores, specialty stores, off-price stores, boutiques and Internet businesses. Our specific
competitors vary from market to market. We believe the keys to competing in our industry are providing great customer service and customer
experiences in stores and online, which includes compelling price and value, fashion newness, quality of products, selection, convenience,
technology, product fulfillment, personalization and appealing, relevant store environments in top locations.
INVENTORY
We plan our merchandise purchases and receipts to coincide with expected sales trends. For instance, our merchandise purchases and
receipts increase prior to our Anniversary Sale, which has historically extended over the last two weeks of July. We also purchase and
receive a larger amount of merchandise in the fall as we prepare for the holiday shopping season (from late November through December).
At Nordstrom Rack we invest in pack and hold inventory which involves the strategic purchase of merchandise from some of our full-line
stores€ top brands in advance of the upcoming selling seasons to take advantage of favorable buying opportunities. This inventory is typically
held for six months on average and has been an important component of Nordstrom Rack€s inventory strategy. We pay for our merchandise
purchases under the terms established with our vendors.
In order to offer merchandise that our customers want, we purchase from a wide variety of high-quality suppliers, including domestic and
foreign businesses. We also have arrangements with agents and contract manufacturers to produce our private label merchandise. We
expect our suppliers to meet our ‚Nordstrom Partnership Guidelines,ƒ which address our corporate social responsibility standards for matters
such as legal and regulatory compliance, labor, health and safety and the environment, and are available on our website at Nordstrom.com.
EMPLOYEES
During 2015, we employed approximately 72,500 employees on a full- or part-time basis. Due to the seasonal nature of our business,
employment increased to approximately 74,000 employees in July 2015 and 78,000 in December 2015. All of our employees are non-union.
We believe our relationship with our employees is good.
CAUTIONARY STATEMENT
Certain statements in this Annual Report on Form 10-K contain or may suggest ‚forward-lookingƒ information (as defined in the Private
Securities Litigation Reform Act of 1995) that involve risks and uncertainties, including, but not limited to, anticipated financial outlook for the
fiscal year ending January•28, 2017, anticipated annual total and comparable sales rates, anticipated new store openings in existing, new
and international markets, anticipated Return on Invested Capital and trends in our operations. Such statements are based upon the current
beliefs and expectations of the Company€s management and are subject to significant risks and uncertainties. Actual future results may differ
materially from historical results or current expectations depending upon factors including, but not limited to:
Strategic and Operational
„ successful execution of our customer strategy, including expansion into new domestic and international markets, acquisitions,
investments in our stores and online, our ability to realize the anticipated benefits from growth initiatives and our ability to provide a
seamless experience across all channels,
„ timely and effective execution of our ecommerce initiatives and ability to manage the costs and organizational changes associated
with this evolving business model,
„ timely completion of construction associated with newly planned stores, relocations and remodels, all of which may be impacted by
the financial health of third parties,
„ our ability to maintain relationships with our employees and to effectively attract, develop and retain our future leaders,
„ effective inventory management processes and systems, fulfillment processes and systems, disruptions in our supply chain and our
ability to control costs,
„ the impact of any systems failures, cybersecurity and/or security breaches, including any security breach of our systems or those of a
third-party provider that results in the theft, transfer or unauthorized disclosure of customer, employee or Company information or
compliance with information security and privacy laws and regulations in the event of such an incident,
„ successful execution of our information technology strategy,
„ our ability to effectively utilize data in strategic planning and decision making,
„ efficient and proper allocation of our capital resources,
„ our ability to realize the expected benefits, respond to potential risks and appropriately manage potential costs associated with our
program agreement with TD,
„ our ability to safeguard our reputation and maintain our vendor relationships,
„ our ability to respond to the business environment, fashion trends and consumer preferences, including changing expectations of
service and experience in stores and online,
„ the effectiveness of planned advertising, marketing and promotional campaigns in the highly competitive retail industry,
„ the timing, price, manner and amounts of share repurchases by the Company, if any, or any share issuances by the Company,
including issuances associated with option exercises, acquisitions or other matters,
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Nordstrom, Inc. and subsidiaries 5