Ross 2014 Annual Report Download - page 16

investments in new merchants to further develop our relationships with an expanding number of manufacturers and vendors.
Our ongoing objective is to strengthen our ability to procure the most desirable brands and fashions at competitive discounts.
The off-price buying strategies utilized by our experienced team of merchants enable us to purchase Ross merchandise at net
prices that are lower than prices paid by department and specialty stores, and to purchase dd’s DISCOUNTS merchandise at
net prices that are lower than prices paid by moderate department and discount stores.
Pricing. Our policy is to sell brand name merchandise at Ross that is priced 20% to 60% below most department and specialty
store regular prices. At dd’s DISCOUNTS, we sell more moderate brand name product and fashions that are priced 20% to 70%
below most moderate department and discount store regular prices. Our pricing policy is reflected on the price tag displaying
our selling price as well as the comparable selling price for that item in department and specialty stores for Ross merchandise,
or in more moderate department and discount stores for dd’s DISCOUNTS merchandise.
Our pricing strategy at Ross differs from that of a department or specialty store. We purchase our merchandise at lower prices
and mark it up less than a department or specialty store. This strategy enables us to offer customers consistently low prices and
compelling value. On a weekly basis our buyers review specified departments in our stores for possible markdowns based on
the rate of sale as well as at the end of fashion seasons to promote faster turnover of merchandise inventory and to accelerate
the flow of fresh product. A similar pricing strategy is in place at dd’s DISCOUNTS where prices are compared to those in
moderate department and discount stores.
Stores
As of January 31, 2015, we operated a total of 1,362 stores comprised of 1,210 Ross stores and 152 dd’s DISCOUNTS stores.
Our stores are located predominantly in community and neighborhood shopping centers in heavily populated urban and
suburban areas. Where the size of the market and real estate opportunities permit, we cluster Ross stores to benefit from
economies of scale in advertising, distribution, and field management. We do the same for dd’s DISCOUNTS stores.
We believe a key element of our success at both Ross and dd’s DISCOUNTS, is our organized, attractive, easy-to-shop, in-store
environments which allow customers to shop at their own pace. While our stores promote a self-service, treasure hunt shopping
experience, the layouts are designed to enhance customer convenience in their merchandise presentation, dressing rooms,
checkout, and merchandise return areas. Our store’s sales area is based on a prototype single floor design with a racetrack aisle
layout. A customer can locate desired departments by signs displayed just below the ceiling of each department. We enable our
customers to select among sizes and prices through prominent category and sizing markers. At most stores, shopping carts
and / or baskets are available at the entrance for customer convenience. Cash registers are primarily located at store exits for
customer ease and efficient staffing.
We accept a variety of payment methods. We provide refunds on all merchandise (not used, worn, or altered) returned with a
receipt within 30 days. Merchandise returns having a receipt older than 30 days are exchanged or refunded with store credit.
Operating Costs
Consistent with the other aspects of our business strategy, we strive to keep operating costs as low as possible. Among the
factors which have enabled us to do this are: labor costs that are generally lower than full-price department and specialty stores
due to a store design that creates a self-service retail format and due to the utilization of labor saving technologies; economies
of scale with respect to general and administrative costs resulting from centralized merchandising, marketing, and purchasing
decisions; and flexible store layout criteria which facilitate conversion of existing buildings to our formats.
Information Systems
We continue to invest in new information systems and technology to provide a platform for growth over the next several years.
Recent initiatives include enhancements to our merchandise planning, core merchandising, allocation management, and store
point-of-sale and store labor management systems. These initiatives support our expansion in both new and existing markets
and our assortment execution and plan achievement, while also supporting future growth.
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