Radio Shack 2008 Annual Report Download - page 20

We conduct business outside the United States, which presents potential risks.
Some of our assets are held and a portion of our revenue is generated outside the United States in
Mexico, China and Hong Kong. Part of our growth strategy is to expand our international business
because the growth rates and the opportunity to implement operating improvements may be greater than
those typically achievable in the United States. International operations entail significant risks and
uncertainties, including, without limitation:
• Economic, social and political instability in any particular country or region
• Adverse changes in currency exchange rates
• Government restrictions on converting currencies or repatriating funds
• Unexpected changes in foreign laws and regulations or in trade, monetary or fiscal policies
• High inflation and monetary fluctuations
• Restrictions on imports and exports
• Difficulties in hiring, training and retaining qualified personnel, particularly finance and accounting
personnel with U.S. GAAP expertise
• Inability to obtain access to fair and equitable political, regulatory, administrative and legal
systems
• Adverse changes in government tax policy
• Difficulties in enforcing our contractual rights or enforcing judgments or obtaining a just result in
local jurisdictions
• Potentially adverse tax consequences of operating in multiple jurisdictions
Any of these factors, by itself or in combination with others, could materially and adversely affect our
business, results of operations and financial condition.
We may be unable to keep existing stores in current locations or open new stores in desirable
locations, which could adversely affect our sales and profitability.
We may be unable to keep existing stores in current locations or open new stores in desirable locations in
the future. We compete with other retailers and businesses for suitable locations for our stores. Local land
use, local zoning issues, environmental regulations and other regulations may affect our ability to find
suitable locations and also influence the cost of leasing, building or buying our stores. We also may have
difficulty negotiating real estate leases and purchase agreements on acceptable terms. Further, to
relocate or open new stores successfully, we must hire and train employees for the new location.
Construction, environmental, zoning and real estate delays may negatively impact store openings and
increase costs and capital expenditures. In addition, when we open new stores in markets where we
already have a presence, our existing locations may experience a decline in sales as a result, and when
we open stores in new markets, we may encounter difficulties in attracting customers due to a lack of
customer familiarity with our brand, our lack of familiarity with local customer preferences, and seasonal
differences in the market. We cannot be certain that new or relocated stores will produce the anticipated
sales or return on investment or that existing stores will not be adversely affected by new or expanded
competition in their market areas.
ITEM 1B. UNRESOLVED STAFF COMMENTS.
None.
ITEM 2. PROPERTIES.
Information on our properties is located in MD&A and the financial statements included in this Annual Report
on Form 10-K and is incorporated into this Item 2 by reference.
The following items are discussed further in the Notes to Consolidated Financial Statements:
Property, Plant and Equipment Note 3
Commitments and Contingencies Note 12
We lease, rather than own, most of our retail facilities. Our stores are located in shopping malls, stand-alone
buildings and shopping centers owned by other entities. We lease one distribution center in the United States
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