Ross 2010 Annual Report Download - page 25

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23
Stores. Total stores open at the end of 2010, 2009, and 2008 were 1,055, 1,005, and 956, respectively. The number of stores
at the end of fi scal 2010, 2009, and 2008 increased by 5%, 5%, and 7% from the respective prior years. Our expansion strategy
is to open additional stores based on market penetration, local demographic characteristics, competition, expected store
profi tability, and the ability to leverage overhead expenses. We continually evaluate opportunistic real estate acquisitions and
opportunities for potential new store locations. We also evaluate our current store locations and determine store closures based
on similar criteria.
2010 2009 2008
Stores at the beginning of the period 1,005 956 890
Stores opened in the period 56 56 77
Stores closed in the period (6) (7) (11)
Stores at the end of the period 1,055 1,005 956
Selling square footage at the end of the period (000) 24,800 23,700 22,500
Sales. Sales for fi scal 2010 increased $681.9 million, or 9.5%, compared to the prior year due to the opening of 50 net new
stores during 2010, and a 5% increase in sales from “comparable” stores (defi ned as stores that have been open for more than
14 complete months). Sales for fi scal 2009 increased $698.1 million, or 10.8%, compared to the prior year due to the opening of
49 net new stores during 2009, and a 6% increase in sales from comparable stores.
Our sales mix is shown below for fi scal 2010, 2009, and 2008:
2010 2009 2008
Ladies 29% 30% 32%
Home accents and bed and bath 25% 24% 23%
Men’s 13% 13% 14%
Accessories, lingerie, fi ne jewelry, and fragrances 12% 13% 12%
Shoes 12% 11% 10 %
Children’s
9% 9% 9%
Total 100% 100% 100%
We intend to address the competitive climate for off-price apparel and home goods by pursuing and refi ning our existing
strategies and by continuing to strengthen our organization, to diversify our merchandise mix, and to more fully develop our
organization and systems to improve regional and local merchandise offerings. Although our strategies and store expansion
program contributed to sales gains in fi scal 2010, 2009, and 2008, we cannot be sure that they will result in a continuation of
sales growth or in an increase in net earnings.
Cost of goods sold. Cost of goods sold in fi scal 2010 increased $402.5 million compared to the prior year mainly due to
increased sales from the opening of 50 net new stores during the year, and a 5% increase in sales from comparable stores.
Cost of goods sold as a percentage of sales for fi scal 2010 decreased approximately 130 basis points from the prior year. This
improvement was mainly the result of an 80 basis point increase in merchandise gross margin, which included a 15 basis point
benefi t from lower shortage. In addition, occupancy leveraged 30 basis points, and distribution costs declined by about 30 basis
points. These improvements were partially offset by an increase in freight costs of about 10 basis points.