Neiman Marcus 2003 Annual Report Download - page 5

PART I
ITEM 1. BUSINESS
Business Overview
The Neiman Marcus Group, Inc. (the Company), a Delaware corporation, is a high-end specialty retailer operating principally through
specialty retail stores (Specialty Retail Stores), consisting of 35 Neiman Marcus stores, two Bergdorf Goodman stores and fourteen
clearance centers and through Neiman Marcus Direct, the Company's direct marketing operation (Direct Marketing).
The Neiman Marcus stores are located in premier retail locations in major markets nationwide and the Bergdorf Goodman stores are in
New York City. Both Neiman Marcus and Bergdorf Goodman stores offer high-end fashion apparel and accessories, primarily from
leading designers.
Neiman Marcus Direct, the Company's upscale direct marketing operation, conducts catalog and online sales through four brands —
Neiman Marcus, Horchow, Chef's Catalog and Bergdorf Goodman (beginning in September 2004). Neiman Marcus Direct operates
the neimanmarcus.com, bergdorfgoodman.com, horchow.com and chefscatalog.com websites, offering luxury goods, home
furnishings and high quality cookware to the online consumer.
For more information about the Company's reportable segments, see Item 7, "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and Note 14 to the Consolidated Financial Statements in Item 15.
The Company's fiscal year ends on the Saturday closest to July 31. All references to 2004 relate to the fifty-two weeks ended July 31,
2004; all references to 2003 relate to the fifty-two weeks ended August 2, 2003 and all references to 2002 relate to the fifty-three
weeks ended August 3, 2002.
The Company makes its annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K available free
of charge through its website at www.neimanmarcusgroup.com as soon as reasonably practicable after it electronically files such
material with (or furnishes such material to) the Securities and Exchange Commission. The information contained on the Company's
website is not incorporated by reference into this Form 10-K and should not be considered to be part of this Form 10-K.
Description of Operations
Specialty Retail Stores. Neiman Marcus stores offer women's and men's apparel, fashion accessories, shoes, cosmetics, furs, precious
and fashion jewelry, decorative home accessories, fine china, crystal and silver, epicurean gifts, children's apparel and gift items.
The main Bergdorf Goodman store features high-end women's apparel and unique fashion accessories from leading designers,
traditional and contemporary decorative home accessories, precious and fashion jewelry, cosmetics, gifts and gourmet foods. The
Bergdorf Goodman Men's store is dedicated to fine men's apparel and accessories. The Bergdorf Goodman stores accounted for
approximately 10.3% of total Company revenues and approximately 12.7% of Specialty Retail Stores revenues in 2004.
The clearance centers provide an efficient and controlled outlet for the sale of end-of-season clearance merchandise primarily from
Neiman Marcus stores and Neiman Marcus Direct. Additionally, the Company purchases off-price merchandise directly from existing
vendors to supplement the assortments of the clearance stores.
The Company previously operated three stores under the name The Galleries of Neiman Marcus offering precious and fashion
jewelry, gifts and decorative home accessories in Seattle, Washington; Cleveland, Ohio; and Phoenix, Arizona. The Seattle,
Washington store was closed in the third quarter of 2002 and the remaining two stores were closed in the second quarter of 2004.
Direct Marketing. Neiman Marcus Direct, the Company's upscale direct marketing operation, conducts catalog and online sales
through four brands — Neiman Marcus, Horchow, Chef's Catalog and Bergdorf Goodman (beginning in September 2004). Under the
Neiman Marcus and Bergdorf Goodman brands, Neiman Marcus Direct primarily offers women's and men's apparel, accessories and
home furnishings. The Horchow brand offers quality home
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