Radio Shack 2003 Annual Report Download - page 20

RADIOSHACK 2003 Annual Report
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>changes in the amount and degree of promotional
intensity exerted by current competitors and potential
new competition from both retail stores and alternative
methods or channels of distribution, such as e-commerce,
telephone shopping services and mail order;
>the inability to attract, retain and grow an effective man-
agement team in a dynamic environment or changes in
the cost or availability of a suitable workforce to manage
and support our service-driven operating strategies;
>any potential tariffs imposed on products that we import
from China, as well as the potential strengthening of
China’s currency against the U.S. dollar;
>continuing terrorist activities in the U.S., as well as the
international war on terrorism;
>the disruption of international, national or regional
transportation systems;
>the lack of availability or access to sources of inventory;
>changes in the financial markets that would reduce or
eliminate access to longer term capital or short-term
credit availability;
>the imposition of new restrictions or regulations regard-
ing the products and/or services we sell or changes in
tax rules and regulations applicable to us;
>the occurrence of severe weather events or natural
disasters, which could significantly damage or destroy
outlets or prohibit consumers from traveling to our retail
locations,especially during the peak winter holiday season;
>increases in ocean freight rates; and
>the inability to timely manufacture or receive Asian
shipments due to the potential emergence of a disease,
including SARS.
RADIOSHACK SPECIFIC FACTORS
>The inability to successfully execute our strategy to dom-
inate cost-effective solutions to meet everyone’s routine
electronics needs and families’ distinct electronics wants;
>the failure to differentiate ourselves as an electronics
specialty retailer in the U.S. marketplace;
>the inability to create, maintain or renew profitable con-
tracts or execute business plans with providers of
third-party branded products and with service providers
relating to cellular and PCS telephones;
>the presence or absence of new services or products and
product features in the merchandise categories we sell and
unexpected changes in our actual merchandise sales mix;
>the inability to collect the level of anticipated residual
income, subscriber acquisition fees and rebates for prod-
ucts and third-party services offered by us;
RadioShack is primarily a retailer of consumer electronics
and services. We seek to differentiate ourselves from
our various competitors by focusing on dominating cost-
effective solutions to meet everyone’s routine electronics
needs and families’ distinct electronics wants.This strategy
allows us to take advantage of the unique opportunities
provided by our extensive retail presence, specially-trained
sales staff and relationships with reputable vendors.We
believe this strategy provides us with the opportunity to
increase our market share in the highly competitive con-
sumer electronics area. In addition, we continue to focus on
methods to reduce the costs of goods sold and selling,
general and administrative expense. Furthermore,we believe
that, by focusing on opportunities such as innovative
products, new markets, licensing opportunities and creative
distribution channels, we can ultimately generate increased
financial returns for our shareholders over the long term.
This section of our Annual Report discusses certain factors
that may affect our future results (including economic and
industry-wide factors), our critical accounting policies and
estimates, the results of our operations, our liquidity and
financial condition, and our risk management practices.
Factors That May Affect Future Results
Matters discussed in MD&A and in other parts of this
document include forward-looking statements within the
meaning of the federal securities laws.These matters
include statements concerning management’s plans and
objectives relating to our operations or economic per-
formance and related assumptions.We specifically disclaim
any duty to update any of the information set forth in this
document, including any forward-looking statements.
Forward-looking statements are made based on manage-
ment’s current expectations and beliefs concerning future
events and, therefore, involve a number of risks and
uncertainties. Management cautions that forward-looking
statements are not guarantees, and our actual results
could differ materially from those expressed or implied in
the forward-looking statements. Important factors that
could cause our actual results of operations or financial
condition to differ include, but are not necessarily limited
to, the following factors.
GENERAL BUSINESS FACTORS
>Changes in the national or regional U.S. economic condi-
tions, including, but not limited to, recessionary or
inflationary trends, level of the equity markets, consumer
credit availability, interest rates, consumers’disposable
income and spending levels, job security and unemploy-
ment, and overall consumer confidence;
Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”)