Circuit City 2009 Annual Report Download - page 9

Table of Contents
catalogs. We mail catalogs to both businesses and individual consumers. In the case of business mailings, we mail our catalogs to many
individuals at a single business location, providing us with multiple points-of-entry. Our in-
house staff designs all of our catalogs, which reduces
overall catalog expense and shortens catalog production time. . Our catalogs are printed by third parties under fixed pricing arrangements. The
commonality of certain core pages of our catalogs also allows for economies of scale in catalog production.
With increased focus on internet advertising, the distribution of our catalogs decreased to 46 million in 2009, which was 26.9% less than in the
prior year. In 2009, we mailed approximately 38 million catalogs in North America, a 18.5% decrease from last year and approximately 8
million catalogs in Europe, or 51.3% fewer than 2008.
Customer Service, Order Fulfillment and Support
We receive orders through the internet, by telephone, electronic data interchange and by fax. We generally provide toll-free telephone number
access for our customers in countries where it is customary. Certain domestic call centers are linked to provide telephone backup in the event of
a disruption in phone service.
Certain of our products are carried in stock, and orders for such products are fulfilled on a timely basis directly from our distribution centers,
typically within one the day of the order. We operate out of multiple sales and distribution facilities in North America and Europe. Orders are
generally shipped by third-party delivery services. We maintain relationships with a number of large distributors in North America and Europe
that also deliver products directly to our customers.
We provide extensive technical telephone support to our private label PC customers. We maintain a database of commonly asked questions for
our technical support representatives, enabling them to respond quickly to similar questions. We conduct regular on-
site training seminars for our
sales representatives to help ensure that they are well trained and informed regarding our latest product offerings.
Suppliers
We purchase substantially all of our products and components directly from manufacturers and large wholesale distributors. In 2009, one vendor
accounted for 12.0% of our purchases and another vendor accounted for 11.3% of our purchases. One vendor accounted for 12.0% and 14.4% of
our purchases in 2008 and 2007, respectively. The loss of these vendors, or any other key vendors, could have a material adverse effect on us.
Certain private label products are manufactured by third-
parties to our specifications. Many of these private label products have been designed or
developed by our in-house product design and development teams.
Competition and Other Market Factors
Technology Products
The North American and European technology product markets are highly competitive, with many U.S., Asian and European companies vying
for market share. There are few barriers of entry, with these products being sold through multiple channels of distribution, including direct
marketers, local and national retail computer stores, computer resellers, mass merchants, over the internet and by computer and office supply
superstores.
Timely introduction of new products or product features are critical elements to remaining competitive. Other competitive factors include
product performance, quality and reliability, technical support and customer service, marketing and distribution and price. Some of our
competitors have stronger brand-
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