Buffalo Wild Wings 2009 Annual Report Download - page 21

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• Creating guest awareness of our restaurants in new markets;
• Competition in new and existing markets; and
• General economic conditions.
We must identify and obtain a sufficient number of suitable new restaurant sites for us to sustain our revenue growth rate.
We require that all proposed restaurant sites, whether for company-owned or franchised restaurants, meet our site selection
criteria. We may make errors in selecting these criteria or applying these criteria to a particular site, or there may be an insignificant
number of new restaurant sites meeting these criteria that would enable us to achieve our planned expansion in future periods. We face
significant competition from other restaurant companies and retailers for sites that meet our criteria and the supply of sites may be
limited in some markets. Further, we may be precluded from acquiring an otherwise suitable site due to an exclusivity restriction held
by another tenant. As a result of these factors, our costs to obtain and lease sites may increase, or we may not be able to obtain certain
sites due to unacceptable costs. Our inability to obtain suitable restaurant sites at reasonable costs may reduce our growth rate.
Shortages or interruptions in the availability and delivery of food and other supplies may increase costs or reduce revenues.
Possible shortages or interruptions in the supply of food items and other supplies to our restaurants caused by inclement
weather, terrorist attacks, natural disasters such as floods, drought and hurricanes, pandemics, the inability of our vendors to obtain
credit in a tightened credit market, food safety warnings or advisories or the prospect of such pronouncements, or other conditions
beyond our control could adversely affect the availability, quality and cost of items we buy and the operations of our restaurants. Our
inability to effectively manage supply chain risk could increase our costs and limit the availability of products critical to our restaurant
operations.
We may experience higher-than-anticipated costs associated with the opening of new restaurants or with the closing,
relocating, and remodeling of existing restaurants, which may adversely affect our results of operations.
Our revenues and expenses can be impacted significantly by the number and timing of the opening of new restaurants and the
closing, relocating, and remodeling of existing restaurants. We incur substantial pre-opening expenses each time we open a new
restaurant and other expenses when we close, relocate, or remodel existing restaurants. The expenses of opening, closing, relocating or
remodeling any of our restaurants may be higher than anticipated. An increase in such expenses could have an adverse effect on our
results of operations.
Our restaurants may not achieve market acceptance in the new geographic regions we enter.
Our expansion plans depend on opening restaurants in new markets where we or our franchisees have little or no operating
experience. We may not be successful in operating our restaurants in new markets on a profitable basis. The success of these new
restaurants will be affected by the different competitive conditions, consumer tastes, and discretionary spending patterns of the new
markets as well as our ability to generate market awareness of the Buffalo Wild Wings ® brand. Sales at restaurants opening in new
markets may take longer to reach average annual restaurant sales, if at all, thereby affecting their profitability.
New restaurants added to our existing markets may take sales from existing restaurants.
We and our franchisees intend to open new restaurants in our existing markets, which may reduce sales performance and
guest visits for existing restaurants in those markets. In addition, new restaurants added in existing markets may not achieve sales and
operating performance at the same level as established restaurants in the market.
An impairment in the carrying value of our goodwill or other intangible assets could adversely affect our financial condition
and consolidated results of operations.
11
Source: BUFFALO WILD WINGS INC, 10-K, February 26, 2010 Powered by Morningstar® Document Research℠