Office Depot 2012 Annual Report Download - page 8

We offer customer loyalty programs that provide customers with rewards that can be applied against future Office Depot purchases o
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other incentives. These programs have provided us with valuable information enabling us to market more effectively to ou
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customers. These programs may change in popularity in the future, and we may make alterations to them from time to time.
We perform periodic competitive pricing analyses to monitor each market, and prices are adjusted as necessary to adhere to ou
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pricing philosophy and further our competitive positioning. We generally expect that our everyday pricing is competitive with othe
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resellers of office products.
We acquire new customers by selectively mailing specially designed catalogs and by making on-premises sales calls to prospective
customers. We also make outbound sales calls using dedicated agents through our telephone account management program. We
obtain the names of prospective customers in new and existing markets through the purchase of selected lists from outside marketing
information services and other sources as well as through the use of a proprietary mailing list system. We also acquire customers
through e-mail marketing campaigns and online affiliates. No single customer in any of our Divisions accounts for more than 10% o
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our total sales or accounts receivable.
Our business is somewhat seasonal, with sales generally trending lower in the second quarter, following the “back-to-business” sales
cycle in the first quarter and preceding the “back-to-school” sales cycle in the third quarter and the holiday sales cycle in the fourth
quarter. Certain working capital components may build and recede during the year reflecting established selling cycles. Business
cycles can and have impacted our operations and financial position when compared to other periods.
Copy and Print
Our North American retail stores contain a Copy & Print Depot offering printing, reproduction, mailing, shipping, and othe
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services. This includes Xerox Certified Print Specialist associates to assist with digital imaging and printing and shipping services
through UPS and the U.S. Postal Service. In addition to the in-store locations, we operate nine regional print facilities, which support
copy and print orders taken in our North American Retail and North American Business Solutions Divisions. We also offer copy and
print services to our customers in Europe through our e-commerce business and certain retail locations.
Intellectual Property
We hold trademark registrations domestically and worldwide and have numerous other applications pending worldwide for the names
“Office Depot”, “Viking”, “Ativa”, “Foray”, “Realspace”, and others. We consider the trademark for the Office Depot name the most
significant trademark held by us because of its impact on market awareness across all of our businesses and on customers’
identification with us. As with all domestic trademarks, our trademark registrations in the United States are for a ten year period and
are renewable every ten years, prior to their respective expirations, as long as the trademarks are used in the regular course of trade.
Industry and Competition
We operate in a highly competitive environment in all three Divisions. We believe that we compete favorably on the basis of price,
service, relationships and selection. We compete with office supply stores, wholesale clubs, discount stores, mass merchandisers,
Internet-based companies, food and drug stores, computer and electronics superstores and direct marketing companies. These
companies, in varying degrees, compete with us in substantially all of our current markets.
Other office supply retail companies market similarly to us in terms of store format, pricing strategy, product selection and product
availability in the markets where we operate, primarily those in the United States. We anticipate that in the future we will continue to
face increased competition from these companies.
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