DSW 2008 Annual Report Download - page 12

Inc. an
d
Fruga
l
Fann
i
e’s Fas
hi
on Ware
h
ouse stores t
h
roug
h
Decem
b
er 2012, January 2013, an
d
Apr
il
2012
,
r
espectivel
y
. We operate leased departments for Filene’s Basement, a wholl
y
-owned subsidiar
y
of Retail Ventures,
under a renewable supply agreement through January 2010.
We own t
h
e merc
h
an
di
se, recor
d
sa
l
es o
f
merc
h
an
di
se net o
f
returns an
d
sa
l
es tax, own t
h
e
fi
xtures (exce
p
t
f
or
Filene’s Basement) and provide supervisory assistance in these covered locations. Stein Mart, Gordmans, Fruga
l
Fann
i
e’s an
d
F
il
ene’s Basement prov
id
et
h
esa
l
es assoc
i
ates. We pay a percentage o
f
net sa
l
es as rent. As o
f
Januar
y
31, 2009, we supplied merchandise to 275 Stein Mart stores, 65 Gordmans stores, one Fru
g
al Fannie’s stor
e
and 36 Filene’s Basement stores. Our leased department se
g
ment has been supported b
y
a store field operations
group, a merc
h
an
di
s
i
ng group an
d
,
f
or non-a
ffili
ate
d
reta
il
ers, a p
l
ann
i
ng an
d
a
ll
ocat
i
on group t
h
at are separat
e
f
rom t
h
e DSW segment
.
dsw
.
co
m
We
l
aunc
h
e
dd
sw.com
i
nt
h
e
fi
rst
h
a
lf
o
ffi
sca
l
2008 to prov
id
e customers w
i
t
h
t
h
e opportun
i
ty to purc
h
as
e
sh
oes an
d
re
l
ate
d
accessor
i
es t
h
rou
gh
our we
b
s
i
te an
d
to
g
a
i
n mar
k
et s
h
are
by
serv
i
n
g
customers
i
nre
gi
ons w
h
ere
we do not currentl
y
have stores. We have entered into a ten-
y
ear lease a
g
reement for space to serve as a fulfillment
c
enter for dsw.com sales. We o
p
erate a call center to su
pp
ort both DSW stores and dsw.com to address our custome
r
s
er
vi
ce nee
d
s.
M
erchandise
S
u
pp
liers and Mi
x
We believe we have
g
ood relationships with our vendors. We purchase merchandise directl
y
from more than
400
d
omest
i
can
df
ore
i
gn ven
d
ors. Our ven
d
ors
i
nc
l
u
d
e supp
li
ers w
h
oe
i
t
h
er manu
f
acture t
h
e
i
r own merc
h
an
di
se o
r
s
upp
l
y merc
h
an
di
se manu
f
acture
db
yot
h
ers, or
b
ot
h
. Most o
f
our
d
omest
i
cven
d
ors
i
mport a
l
arge port
i
on o
f
t
h
e
i
r
m
erchandise from abroad. We have implemented qualit
y
control pro
g
rams under which our DSW bu
y
ers ar
e
i
nvo
l
ve
di
n esta
bli
s
hi
ng stan
d
ar
d
s
f
or qua
li
ty an
dfi
t accor
di
ng to w
hi
c
h
actua
l
pro
d
uct
i
s manu
f
acture
d
an
d
our
s
tore personne
l
exam
i
ne
i
ncom
i
ng merc
h
an
di
se
i
n regar
d
stoco
l
or, mater
i
a
l
an
d
overa
ll
qua
li
ty o
f
manu
f
actur
i
ng
.
A
s the number of DSW locations increases and our sales volumes
g
row, we believe there will continue to be
adequate sources available to acquire a sufficient supply of quality goods in a timely manner and on satisfactor
y
e
conom
i
c terms. Dur
i
ng
fi
sca
l
2008, merc
h
an
di
se supp
li
e
db
y our t
h
ree top ven
d
ors accounte
df
or approx
i
mate
ly
2
0
%o
f
our net
f
oot
w
ear sa
l
es
.
We separate our DSW merc
h
an
di
se
i
nto
f
our pr
i
mary categor
i
es — women’s
f
ootwear; men’s
f
ootwear;
athletic footwear; and accessories. While shoes are the main focus of DSW, we also offer a complementar
y
assortment of handba
g
s, hosier
y
and other accessories.
Th
e
f
o
ll
ow
i
n
g
ta
bl
e sets
f
ort
h
t
h
e approx
i
mate percenta
g
eo
f
our sa
l
es attr
ib
uta
bl
e to eac
h
merc
h
an
di
se
c
ate
g
or
y
for the fiscal
y
ears below:
Category Fiscal 2008 Fiscal 2007 Fiscal 2006
W
omen’s
.
....................................... 66% 6
5
%6
5%
M
e
n
’s
.
.......................................... 1
5
% 16% 16%
A
t
hl
et
i
c
.
........................................
14% 14% 14%
Accessor
i
es an
dO
t
h
er...............................
5
%
5
%
5
%
Dis
tr
ibu
t
io
n
O
ur primary distribution center is located in an approximately 700,000 square foot facility in Columbus, Ohio
.
T
h
e
d
es
i
gn o
f
t
h
e
di
str
ib
ut
i
on center
f
ac
ili
tates t
h
e prompt
d
e
li
very o
f
pr
i
or
i
ty purc
h
ases an
df
ast-se
lli
ng
f
ootwear to
s
tores so we can ta
k
e
f
u
ll
a
d
vanta
g
eo
f
eac
h
se
lli
n
g
season. We
h
ave en
g
a
g
e
d
at
hi
r
d
part
yl
o
gi
st
i
cs serv
i
ce prov
id
er
t
o receive orders ori
g
inatin
g
from suppliers on the West Coast or imports enterin
g
the United States at a West Coas
t
p
ort o
f
entry t
h
roug
h
our West Coast
b
ypass. T
h
ese
i
n
i
t
i
a
l
s
hi
pments are t
h
en s
hi
ppe
db
yt
hi
s serv
i
ce prov
id
er to ou
r
p
oo
l
po
i
nts an
d
onwar
d
s to stores
b
ypass
i
ng our Co
l
um
b
us
di
str
ib
ut
i
on center
f
ac
ili
ty. We w
ill
cont
i
nue to eva
l
uate
e
xpansion of this process for applicabilit
y
in other parts of the countr
y
. We also operate a fulfillment center i
n
8