Petsmart 2011 Annual Report Download - page 13

Offer superior customer service. Our emphasis on the customer is designed to provide an unparalleled
shopping experience every time a customer visits our stores. Using a detailed associate learning curriculum and
role-playing techniques, we train store associates to identify customer needs and provide appropriate solutions.
We measure our success in every store, and a portion of the annual incentive program for the store management
team is linked to customer satisfaction. By providing pet parents with expertise and solutions, we believe we are
strengthening our relationships with customers, building loyalty and enhancing our leading market position, thus
differentiating ourselves from grocery and other mass merchandisers.
Focus on operating excellence. Our commitment to operating excellence emphasizes retail basics like
store cleanliness, short check-out lines, a strong in-stock position, an effective supply chain and outstanding care
of the pets in our stores, which allows us to provide a consistently superior customer experience. This focus on
operating excellence simplifies processes, makes our stores more efficient and easier to operate and allows asso-
ciates to be more engaged and productive. We continually seek opportunities to strengthen our merchandising
capabilities allowing us to provide a differentiated product assortment, including pet specialty channel exclusive
products and our proprietary brand offerings, to drive innovative solutions and value to our customers.
Grow our pet services business. Based on net services sales, we are North America’s leading specialty
provider of pet services, which includes professional grooming, training, boarding and day camp. Full-service
veterinary hospitals are available in 799 of our stores, through our partnership with Banfield and other third par-
ties in Canada. Pet services are an integral part of our strategy, and we are focused on driving profitable growth
in our services business. We believe services further differentiate us from our competitors, drive traffic and
repeat visits to our stores, provide cross-selling opportunities, allow us to forge a strong relationship with our
customers, increase transaction size and enhance operating margins.
Add stores and provide the right store format to meet the needs of our customers. Our expansion strategy
includes increasing our share in existing multi-store markets, penetrating new markets and achieving operating
efficiencies and economies of scale in merchandising, distribution, information systems, procurement, marketing
and store operations. We continually evaluate our store format to ensure we are meeting the needs and expect-
ations of our customers, while providing a return on investment to our stockholders. A store format that empha-
sizes our highly differentiated products and pet services offerings, when combined with our other strategic
initiatives, will generally contribute higher comparable store sales growth (or sales in stores open at least one
year), profitability and return on investment.
We believe these strategic initiatives will continue to drive comparable store sales and overall sales growth,
allow us to focus on managing capital and leveraging costs and drive product margins to produce profitability
and return on investment for our stockholders.
Our Stores
Our stores are generally located at sites co-anchored by strong destination mass merchandisers and typically
are in or near major regional shopping centers. We are engaged in an ongoing expansion program, opening new
stores in both new and existing markets and relocating existing stores. Store activity was as follows:
2011 2010 2009
Store count at beginning of year .................................. 1,187 1,149 1,112
New, or relocated stores opened .................................. 53 46 45
Stores closed .................................................. (8) (8) (8)
Store count at end of year ........................................ 1,232 1,187 1,149
Distribution
Our distribution network and information systems are designed to optimize store inventory, drive efficien-
cies in store labor, facilitate a high in-stock position and promote high distribution center productivity. We oper-
ate two kinds of distribution centers: forward distribution centers and combination centers. Our forward
distribution centers handle consumable products that require rapid replenishment, while our combination dis-
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