Dick's Sporting Goods 2011 Annual Report Download - page 33

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Information Systems
Our core merchandising, allocation and replenishment systems are from JDA. The data generated by
these systems are consolidated into a comprehensive data warehouse application that was purpose-built
to provide near real-time performance information across a broad spectrum of critical metrics for our
business. All functions of the business have access to highly accurate and consistent information related
to the various components of sales, inventory and margin from department to SKU level. Our stores
are on-line to the corporate data center and utilize high-speed data communications to update sales
data continuously throughout the business day while also enabling our sales associates to access the
internet for additional sales opportunities on the Company’s websites via POS registers, associate
ordering system (‘‘AOS’’) kiosks and special services computers. We utilize a highly optimized and
customized version of the Advanced Store POS application software from NCR in both our Dick’s and
Golf Galaxy stores.
The enterprise data center located within our corporate headquarters, which we refer to as the Store
Support Center (‘‘SSC’’), is equipped with mainframe and mid-range computers and storage systems
from IBM, integrated with voice and data networking communication equipment from Cisco. This
facility has been built to support the future growth of the Company. The Company utilizes a third-party
service provider for disaster recovery services and is in the process of establishing a separate data
center to serve as the Company’s disaster recovery redundancy location.
Our end-to-end supply chain management suite of software applications is from Manhattan Associates
and operates our three distribution centers from the central computing complex in our SSC. The
Company’s Financial and Human Resource Management systems are PeopleSoft applications provided
by Oracle. All third party applications are integrated and enhanced using state-of-the-art software tools
and techniques developed internally.
Purchasing and Distribution
In addition to merchandise procurement, our buying staff is also responsible for determining initial
pricing and product marketing plans and working with our allocation and replenishment groups to
establish stock levels and product mix. Our buying staff also has frequent communications with our
store operations and regionally-based market research personnel to monitor shifts in consumer tastes
and regional market trends.
Our planning, replenishment, allocation and merchandise control groups are responsible for
merchandise allocation, inventory control and automated replenishment systems. These groups act as
the central processing intermediary between our buying staff and our stores and also coordinate the
inventory levels necessary for each advertising promotion with our buying staff and our advertising
department, tracking the effectiveness of each advertisement to allow our buying staff and our
advertising department to determine the relative success of each promotional program. In addition,
these groups also manage the implementation of price changes, creation of vendor purchase orders and
determination of inventory levels for each store.
We purchase merchandise from approximately 1,200 vendors. During fiscal 2011, Nike, our largest
vendor, represented approximately 15% of our merchandise purchases. No other vendor represented
10% or more of our fiscal 2011 merchandise purchases. We do not have long-term purchase contracts
with any of our vendors and all of our purchases from vendors are done on a short-term purchase
order basis.
We operate three regional distribution centers: a 725,000 square foot distribution center in Plainfield,
Indiana, a 657,000 square foot distribution center near Atlanta, Georgia, and a 601,000 square foot
distribution center in Smithton, Pennsylvania. Additionally, the Company is currently constructing a
624,000 square foot distribution center in Goodyear, Arizona, which is currently expected to be
operational in January 2013. Vendors directly ship floor ready merchandise to our distribution centers,
Dick’s Sporting Goods, Inc. 2011 Annual Report 11