Sears 2007 Annual Report Download - page 7

but not limited to, the cost of goods, consumer debt levels and buying patterns, economic conditions, customer
preferences, inflation, currency exchange fluctuations, weather patterns, and catastrophic events. Item 1A in this
report on Form 10-K contains further information regarding risks to our company.
Employees
As of February 2, 2008, we had approximately 302,000 employees in the United States and U.S. territories,
and approximately 35,000 employees in Canada through Sears Canada including, in each case, part-time
employees.
Our Website; Availability of SEC Reports and Other Information
Our corporate website is located at searsholdings.com. Our Annual Reports on Form 10-K, Quarterly
Reports on Form 10-Q, Current Reports on Form 8-K and any amendments to these reports are available, free of
charge, through the “SEC Filings” portion of the Investor Information section of our website as soon as
reasonably practicable after they are electronically filed with, or furnished to, the Securities and Exchange
Commission (“SEC”).
The Corporate Governance Guidelines of our Board of Directors, the charters of the Audit, Compensation,
Finance and Nominating and Corporate Governance Committees of the Board of Directors, our Code of Conduct
and the Board of Directors Code of Conduct are available in the Corporate Governance section of
searsholdings.com. References to our website address do not constitute incorporation by reference of the
information contained on the website, and the information contained on the website is not part of this document.
Item 1A. Risk Factors
References to “us,” “we” and “our” refer to the Company. The following risk factors could adversely affect
our business, results of operations and financial condition. The risks and uncertainties described below are not
the only ones we face. Additional risks and uncertainties not presently known to us may also negatively impact
us.
If we fail to offer merchandise and services that our customers want, our sales may be limited, which
would reduce our revenues and profits.
In order for our business to be successful, we must identify, obtain supplies of, and offer to our customers,
attractive, innovative and high-quality merchandise on a continuous basis. Our products and services must satisfy
the desires of our customers, whose preferences may change in the future. If we misjudge either the demand for
products and services we sell or our customers’ purchasing habits and tastes, we may be faced with excess
inventories of some products and missed opportunities for products and services we chose not to offer. In
addition, our sales may decline or we may be required to sell the merchandise we have obtained at lower prices.
This would have a negative effect on our business and results of operations.
If we do not successfully manage our inventory levels, our operating results will be adversely affected.
We must maintain sufficient inventory levels to operate our business successfully. However, we also must
guard against accumulating excess inventory as we seek to minimize out-of-stock levels across all product
categories and to maintain in-stock levels. We obtain a significant portion of our inventory from vendors located
outside the United States. These vendors often require lengthy advance notice of our requirements in order to be
able to supply products in the quantities we request. This usually requires us to order merchandise, and enter into
purchase order contracts for the purchase and manufacture of such merchandise, well in advance of the time
these products will be offered for sale. As a result, we may experience difficulty in responding to a changing
retail environment, which makes us vulnerable to changes in price. If we do not accurately anticipate the future
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