DSW 2009 Annual Report Download - page 9

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If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be
incorrect, actual results, performance or achievements may vary materially from what we have projected.
Furthermore, new factors emerge from time to time and it is not possible for management to predict all such
factors, nor can it assess the impact of any such factor on the business or the extent to which any factor, or
combination of factors, may cause results to differ materially from those contained in any forward-looking
statement. Any forward-looking statement speaks only as of the date on which such statement is made, and, except
as required by law, DSW undertakes no obligation to update any forward-looking statement to reflect events or
circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events.
ITEM 1. BUSINESS.
General
DSW is a leading U.S. branded footwear specialty retailer operating 305 shoe stores in 39 states as of
January 30, 2010. We offer a wide assortment of better-branded dress, casual and athletic footwear for women and
men, as well as accessories through our DSW stores and dsw.com. In addition, we operate 356 leased departments
for four other retailers as of January 30, 2010. Our typical DSW customers are brand, value, quality and style-
conscious shoppers who have a passion for footwear and accessories. Our core focus is to create a distinctive
shopping experience that satisfies both the rational and emotional shopping needs of our DSW customers by
offering them a vast, exciting assortment of in-season styles combined with the convenience and value they desire.
Our DSW stores average approximately 22,000 square feet and carry approximately 24,000 pairs of shoes. We
believe this combination of assortment, convenience and value differentiates us from our competitors and appeals to
consumers from a broad range of socioeconomic and demographic backgrounds.
Please see our financial statements and the notes thereto in Item 8 of this Annual Report on Form 10-K for
financial information about our two reportable segments: the DSW segment, which includes DSW stores and
dsw.com, and leased departments.
Corporate History
We were incorporated in the state of Ohio on January 20, 1969 and opened our first DSW store in Dublin, Ohio
in July 1991. In 1998, a predecessor of Retail Ventures purchased DSW and affiliated shoe businesses from
Schottenstein Stores Corporation (“SSC”) and Nacht Management, Inc. In July 2005, we completed an initial public
offering (“IPO”) of our Class A Common Shares, selling approximately 16.2 million shares at an offering price of
$19.00 per share. As of January 30, 2010, Retail Ventures owned approximately 27.4 million of our Class B
Common Shares, or approximately 62.4% of our total outstanding shares and approximately 93.0% of the combined
voting power of our outstanding Common Shares.
Competitive Strengths
We believe that our leading market position is driven by our competitive strengths: the breadth of our branded
product offerings, our distinctive and convenient store layout, the value proposition offered to customers and our
financial strength.
The Breadth of Our Product Offerings
Our goal is to excite our customers with an assortment of shoes that fulfill a broad range of style and fashion
preferences. DSW stores and dsw.com sell a large assortment of better-branded merchandise. We purchase directly
from more than 400 domestic and foreign vendors, primarily in-season footwear found in specialty and department
stores and branded make-ups (shoes made exclusively for a retailer), with the assortment at each store geared toward
the particular demographics of the location. A typical DSW store carries approximately 24,000 pairs of shoes in
approximately 2,000 styles compared to a significantly smaller product offering at typical department stores. We
also offer a complementary assortment of handbags, hosiery and other accessories which appeal to our brand- and
fashion-conscious customers.
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