Supercuts 2011 Annual Report Download - page 34

Table of Contents
• Liquidity and Capital Resources
MANAGEMENT'S OVERVIEW
Regis Corporation (RGS) owns or franchises beauty salons and hair restoration centers. As of June 30, 2011, we owned, franchised or held
ownership interests in approximately 12,700 worldwide locations. Our locations consisted of 9,819 system wide North American and
International salons, 96 hair restoration centers, and 2,786 locations in which we maintain an ownership interest less than 100 percent. Our salon
concepts offer generally similar products and services and serve mass market consumers. Our salon operations are organized to be managed
based on geographical location. Our North American salon operations include 9,419 salons, including 1,936 franchise salons, operating in the
United States, Canada and Puerto Rico primarily under the trade names of Regis Salons, MasterCuts, SmartStyle, Supercuts and Cost Cutters.
Our international salon operations include 400 salons located in Europe, primarily in the United Kingdom. Hair Club for Men and Women
includes 96 North American locations, including 29 franchise locations. During fiscal year 2011, we had approximately 55,000 corporate
employees worldwide.
Our fiscal year 2012 growth strategy is focused on increasing customer visits. We plan to execute our strategy through four focus areas of
putting customers and stylists first, leveraging the power of our salon brands, technology and connectivity, and delivering improved financial
performance. Initiatives of these four focus areas include:
• Putting customers and stylists first through improving both the experience for the person in the chair and behind the chair. The
Company will work on attracting, developing and retaining the best stylists through orientation programs, training and
development and rewards and recognition.
• Leveraging the power of our salon brands through focusing on the best brands within the best markets, enhanced focus and
alignment and aggressive strategies including discounting.
• Using technology and connectivity, including internet in the salons, to enhance effectiveness of field management and improve
customer satisfaction and retention.
•
Delivering improved financial performance through undertaking cost savings initiatives in the range of $20.0 to $30.0 million
with examples including renegotiated interest rates and a planned reduction in travel costs.
Salon Business
The strength of our salon business is in the fundamental similarity and broad appeal of our salon concepts that allow flexibility and multiple
salon concept placements in shopping centers and neighborhoods. Each concept generally targets the middle market customer, however, each
attracts a different demographic. We believe there are growth opportunities in all of our salon concepts. When commercial opportunities arise,
we anticipate testing and developing new salon concepts to complement our existing concepts.
We execute our salon growth strategy by focusing on real estate. Our salon real estate strategy is to add new units in convenient locations
with good visibility and customer traffic, as well as appropriate trade demographics. Our various salon and product concepts operate in a wide
range of retailing environments, including regional shopping malls, strip centers and Walmart Supercenters. We believe that the availability of
real estate will augment our ability to achieve the aforementioned long-
term growth objectives. In fiscal 2012, our outlook for constructed salons
is approximately 285 units. In fiscal year 2012, capital expenditures and acquisitions are expected to be approximately $95.0 and $25.0 million,
respectively.
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