OfficeMax 2005 Annual Report Download - page 10

Employees
On December 31, 2005, we had approximately 35,000 employees, including approximately
12,000 part-time employees.
ITEM 1A. RISK FACTORS
Cautionary and Forward-Looking Statements
This Annual Report on Form 10-K contains forward-looking statements. Statements that are not
historical or current facts, including statements about our expectations, anticipated financial results
and future business prospects, are forward-looking statements. You can identify these statements
by our use of words such as ‘‘may,’’ ‘‘will,’’ ‘‘expect,’’ ‘‘believe,’’ ‘‘should,’’ ‘‘plan,’’ ‘‘anticipate’’ and
other similar expressions. You can find examples of these statements throughout this report,
including Management’s Discussion and Analysis of Financial Condition and Results of Operations.
We cannot guarantee that our actual results will be consistent with the forward-looking statements
we make in this report. We have listed below some of the inherent risks and uncertainties that
could cause our actual results to differ materially from those we project. We do not assume an
obligation to update any forward-looking statement.
Intense competition in our markets could harm our ability to achieve or maintain
profitability. The office products market is highly competitive. Purchasers of office products have
many options when purchasing office supplies and paper, print and document services, technology
products and solutions and office furniture. We compete with worldwide contract stationers, large
retail office products suppliers, direct-mail distributors, discount retailers, drugstores, supermarkets
and thousands of local and regional contract stationers, many of whom have long-standing
customer relationships. Increased competition in the office products industry, together with
increased advertising, has heightened price awareness among end-users. Such heightened price
awareness has led to margin pressure on office products. Some of our competitors are larger than
we are and have greater financial and other resources available to them, and there can be no
assurance that we can continue to compete successfully with them.
Our retail business may face increased competition from well-established mass merchant
retailers who have the financial and distribution abilities to compete effectively with us should they
choose to (a) increase their presence in the office superstore, Internet office supply or contract
stationer business, or (b) substantially expand their office product offerings in their existing retail
outlets. Further, various other retailers that have not historically competed with superstores, such as
drugstores and grocery chains, have begun carrying at least a limited assortment of basic office
supplies. Many of our competitors have increased their presence in our markets in recent years and
are expected to do so in the future. We may also encounter significant competition in the areas of
price and selection from merchants that focus heavily on Internet sales, some of whom may
operate few, if any, stores and thereby limit their fixed costs. In particular, they may be formidable
competitors with respect to customers who are willing to look for the absolute lowest price without
regard to the other attributes of our business model, including customer service. In addition,
increasing numbers of manufacturers of computer hardware, software and peripherals, including
certain of our suppliers, have expanded their own direct marketing of products, particularly over the
Internet. There is a possibility that any or all of these competitors could become more aggressive in
the future, thereby increasing the number and breadth of our competitors, potentially having a
material adverse effect on our retail business and results of our operations.
We may be unable to open and remodel stores successfully. Our business plans include
the opening and remodeling of a significant number of retail stores, including the opening of up to
70 new stores in 2006. For these plans to be successful, we must identify and lease favorable store
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