Urban Outfitters 2009 Annual Report Download - page 7

In addition to selling its merchandise to specialty retailers, Free People wholesale also shares
production sourcing with our retail segment. Free People employs its own senior and creative
management staff, but shares business support services with the retail segment.
During the second quarter of fiscal 2009, we launched Leifsdottir, the Anthropologie brand’s
wholesale division. Leifsdottir designs, develops and markets sophisticated women’s contemporary
apparel including dresses, tops and bottoms. Leifsdottir is sold through luxury department stores
including Bloomingdale’s, Nordstrom, Neiman Marcus and Bergdorf Goodman, select specialty stores
and our own Anthropologie stores. We also distribute our Leifsdottir products in certain department
stores using a shop-within-shop sales model. We believe that the shop-within-shop model allows for a
more complete merchandising of our Leifsdottir products and will give us greater freedom in
differentiating the presentation of our products and further strengthening our brand image. Leifsdottir
presently maintains a wholesale sales and showroom facility in New York City, New York. Leifsdottir
wholesale sales accounted for less than 1% of total consolidated net sales for fiscal 2009.
Store Environment
We create a unified environment in our stores that establishes an emotional bond with the
customer. Every element of the environment is tailored to the aesthetic preferences of our target
customers. Through creative design, much of the existing retail space is modified to incorporate a
mosaic of fixtures, finishes and revealed architectural details. In our stores, merchandise is integrated
into a variety of creative vignettes and displays designed to offer our customers an entire look at a
distinct lifestyle. This dynamic visual merchandising and display technique provides the connection
among the store design, the merchandise and the customer. Essential components of the ambience of
each store may include playing music that appeals to our target customers, using unique signage and
employing a staff that understands and identifies with the target customer.
Anthropologie considers it important to create an individualized and tailored store shopping
experience for each customer. By providing an inviting and pleasant shopping atmosphere and an
attentive sales staff, including, in many stores, in-store customer care managers, we strive to create a
sense of community in our Anthropologie stores that encourages our target customers to linger and
spend time exploring our stores and product offerings. Anthropologie stores are often placed in unique
and non-traditional retail locations. A majority of our Anthropologie stores opened during fiscal 2009
were located in specialty retail centers, upscale street locations and enclosed shopping malls. We plan
to implement a similar Anthropologie location expansion strategy in fiscal 2010.
Our Urban Outfitters stores are often located in unconventional retail spaces, including a former
movie theater, bank and stock exchange. A majority of our Urban Outfitters stores that opened in fiscal
2009 were located in upscale street locations, specialty retail centers, and enclosed shopping malls. We
plan to implement a similar Urban Outfitters location expansion strategy in fiscal 2010.
Our Free People retail stores opened to date are located in enclosed shopping malls, specialty
retail centers and upscale street locations. We plan to implement a similar Free People location
expansion strategy in fiscal 2010.
Our Terrain garden center is a free-standing location on ten acres of land with street-front view
and access. We plan to open one Terrain location utilizing a similar venue in fiscal 2010.
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