Overstock.com 2005 Annual Report Download - page 13

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review shipping and tracking information. From a customer's point of view, shipping from our warehouses or from the warehouse of
one of these third parties is indistinguishable.
Customer Service
We are committed to providing superior customer service. We staff our customer service department with dedicated in-house and
outsourced professionals who respond to phone, instant online chat and e-mail inquiries on products, ordering, shipping status, and
returns. Our customer service staff processes approximately 40,000 calls per week (and up to approximately 105,000 calls during peak
periods). The same staff processes approximately 30,000 e-mail messages each week (and up to approximately 70,000 e-mail
messages during peak periods), with a turnaround goal of one business day. We use automated e-mail and phone systems to route
traffic to appropriate customer service representatives. The demands on our customer service staff increase significantly during peak
periods, including the several weeks before and after Christmas.
Technology
We use our internally developed Websites and a combination of proprietary technologies and commercially available licensed
technologies and solutions to support our operations. We use the services of XO Communications, Inc., Qwest Communications
International, Inc. and MCI, Inc. to obtain connectivity to the Internet over multiple Gig-E and OC48 links. We currently store our
data on several Oracle 9i and 10g database clusters using Dell and IBM computer hardware connected to multiple large scale EMCs
for high speed disk. Currently, we use Dell PowerEdge servers for our Websites, which are connected to the Oracle database and
operate in a multi-processing Linux environment designed to accommodate large volumes of Internet traffic.
During 2004 we moved our primary computer infrastructure to a co-location facility in Salt Lake City. We now use the computer
facilities located in the data center located at our corporate offices primarily for backups, redundancy, development, and testing.
Competition
The online liquidation services market is new, rapidly evolving, intensely competitive and has relatively low barriers to entry, as
new competitors can launch new Websites at relatively low cost. We believe that competition in the online liquidation market is based
predominantly on:
• price;
• product quality and selection;
• shopping convenience;
• order processing and fulfillment;
• customer service; and
• brand recognition.
Our liquidation services compete with other online retailers and traditional liquidation "brokers," some of which may specifically
adopt our methods and target our customers. We currently or potentially compete with a variety of companies that can be divided into
several broad categories:
• liquidation e-tailers such as SmartBargains;
• online retailers with discount departments such as Amazon.com, Inc., eBay, Inc. and Buy.com, Inc.; and
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