Overstock.com 2010 Annual Report Download - page 7

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Table of Contents
PART I
ITEM 1. BUSINESS
The following description of our business contains forward-looking statements relating to future events or our future financial or operating performance
that involve risks and uncertainties, as set forth above under "Special Note Regarding Forward-Looking Statements." Our actual results could differ
materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth in Section 1A under the heading
"Risk Factors" and elsewhere in this Form 10-K.
Introduction
We are an online retailer offering discount brand name, non-brand name and closeout merchandise, including bed-and-bath goods, home décor,
kitchenware, furniture, watches and jewelry, apparel, electronics and computers, sporting goods, and designer accessories, among other products. We also sell
hundreds of thousands of best seller and current run books, magazines, CDs, DVDs and video games ("BMMG"). We sell these products through our Internet
websites located at www.overstock.com and www.o.co ("Website"). We also operate as part of our Website an online auctions business—a marketplace for
the buying and selling of goods and services—and online sites for listing cars and real estate for sale. In October 2009, we also launched O.biz, a website
where customers can shop for bulk and business related items. In August 2010, we introduced Eziba.com, a private sale website where members can shop
exclusive deals on the latest home décor products, furniture, jewelry, apparel and accessories from many leading brands. Although our four websites are
located at different domain addresses, the technology and equipment and processes supporting the Overstock.com Website and the process of order fulfillment
described herein are the same for all four websites.
Our company, based in Salt Lake City, Utah, was founded in 1997. We launched the Website in March 1999. Our Website offers our customers an
opportunity to shop for bargains conveniently, while offering our suppliers an alternative inventory liquidation or sales channel. We continually add new,
sometimes limited, inventory products to our Website in order to create an atmosphere that encourages customers to visit frequently and purchase products
before our inventory sells out. We sell products primarily in the United States, with a small amount of products (less than 1% of sales) sold internationally.
As used herein, "Overstock.com," "we," "our" and similar terms include Overstock.com, Inc. and its subsidiaries, unless the context indicates otherwise.
Our Business
We deal primarily in discount, replenishable, and closeout merchandise and we use the Internet to aggregate both supply and demand to create an
efficient marketplace for selling these products. We provide manufacturers with a one-stop liquidation channel to sell both large and small quantities of
excess, closeout and replenishable inventory without disrupting sales through traditional channels, which can result in weaker pricing and decreased brand
strength. The merchandise offered on our Website is from a variety of sources, including well-known, brand-name manufacturers. We have organized our
shopping business (sales of product offered through the Shopping Section of our Website) into two principal segments—a "direct" business and a "fulfillment
partner" business. We currently offer approximately 197,000 non-BMMG products in 19 major departments, and approximately 763,000 BMMG products.
Consumers and businesses are able to access and purchase our products 24 hours a day from the convenience of a computer, Internet-enabled mobile
telephone or other Internet-enabled device. Our team of customer service representatives assists customers by telephone, instant online chat and e-mail.
Nearly all of our sales are to customers located in the United States. Less than 1% of our sales are made indirectly to international customers. During the years
ended December 31, 2008, 2009, and 2010, no single customer accounted for more than 1% of our total revenue.
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