Stein Mart 2009 Annual Report Download - page 7

We have an Internet site, www.steinmart.com, to promote Stein Mart’s fashion point of view, as well as provide information for
customers regarding stores, store locations, company management and selected sales promotion activity. We use steinmart.com to
highlight featured merchandise and for traffic stimulation; however, we do not sell merchandise online at this time. Visitors to the
website may apply for the Stein Mart Platinum MasterCard®, sign up to be Preferred Customers and/or purchase electronic gift
certificates.
COMPETITION
Our primary competitors are department and specialty stores, as well as conventional off-price retail chains. From our customer’s
perspective, we believe we differentiate ourselves from department stores and specialty stores due to our (i) everyday low pricing, (ii)
convenient locations in neighborhood shopping centers near upscale neighborhoods, and (iii) assortments that are more edited than
department stores and more varied than specialty stores. We also believe we differentiate ourselves from typical off-price retail
chains by offering (i) primarily current-season merchandise carried by better department or specialty stores, (ii) moderate to better
price levels, (iii) a stronger merchandising “statement,” consistently offering more depth of color and size in individual stock-keeping
units, and (iv) merchandise presentation and customer service more comparable to upscale retailers.
DISTRIBUTION
Our transition to a third-party logistics network (“supply chain”) is nearly complete with product flowing through third-party
consolidation centers located in New Jersey, Dallas and California to third-party distribution centers located in Atlanta, Dallas and
California (started March 2010). The California distribution center is approximately 70 percent operational and should be fully
operational by the end of April 2010. The supply chain methodology enables us to aggregate merchandise from numerous vendors at
the distribution centers, where merchandise is prepared for delivery to stores on a regional basis. Shipments are made by contract
carriers to the stores weekly, depending on location.
EMPLOYEES
As of January 30, 2010, our work force consisted of approximately 12,800 employees (6,400 40-hour equivalent employees). Our
stores employ an average of 46 persons. The number of employees fluctuates during the year based on the particular selling season.
TRADEMARKS
We own the federally registered trademark Stein Mart®, together with a number of other marks used in conjunction with our private
label merchandise program. Management believes that our trademarks are important, but with the exception of Stein Mart®, not
critical to our merchandising strategy.
AVAILABLE INFORMATION
Copies of our annual report on Form 10-K, proxy statement, quarterly reports on Form 10-Q, current reports on Form 8-K, and any
amendments to those filings are available free of charge on the investor relations portion of our website at http://ir.steinmart.com (click
on “SEC Filings”) as soon as reasonably practicable after they are filed electronically with the Securities and Exchange Commission.
In addition, proxy materials for the annual meeting of stockholders are also available at www.proxyvote.com. Also available free of
charge on the www.steinmart.com website (click on “About us”; click on “Corporate Governance”) are the charters for the Audit
Committee, the Compensation Committee, the Nominating and Corporate Governance Committee, the Strategic Planning Committee,
as well as the Code of Conduct and Corporate Governance Guidelines. Printed copies of these items are available free of charge
upon request by writing Stein Mart, Inc., 1200 Riverplace Boulevard, Jacksonville, FL 32207, Attention: Stockholder Relations.
ITEM 1A. RISK FACTORS
Our results of operations and financial condition can be adversely affected by numerous risks and uncertainties. In evaluating the
Company, the risks and uncertainties described below should be considered carefully. Should any of these risks actually materialize,
our business, financial condition, and future prospects could be negatively impacted.
Consumer sensitivity to economic conditions. The retail apparel business is dependent upon the level of consumer spending,
and as a fashion retailer, we rely on the expenditure of discretionary income for most, if not all, of our sales. The recent economic
downturn, including the weakened housing market, worsening unemployment rates, rising personal bankruptcies, and lack of access
to credit have all contributed to erosion in consumer spending. Continued deterioration in the level of consumer spending could have
a material adverse effect on our results of operations.
Intense competition in the retail industry. We face intense competition for customers from department stores, specialty stores and
regional and national off-price retail chains. Many of these competitors are larger and have significantly greater financial and
marketing resources than we do. In addition, many department stores have become more promotional and have reduced their price
points, and certain department stores and certain of our vendors have opened outlet stores which offer merchandise at prices that are
competitive with ours. Many of our competitors also make sales through the Internet, and although we do maintain an Internet site,
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