Stein Mart 2008 Annual Report Download - page 7

television commercials; TV and/or radio advertising is also employed to create additional excitement for specific one-day events. We
are working to create a presence in digital media including online advertising and social networking sites.
Our co-brand Stein Mart Platinum MasterCard® and our Preferred Customer Card programs are important marketing tools. As
customers use the Stein Mart Platinum MasterCard®, they accumulate points that generate reward certificates at certain levels.
Preferred Customer Card customers receive preview copies of select circulars mailed to their home, members only shopping days,
birthday discounts and special email announcements. Both cards provide useful information regarding customer preferences, habits
and advertising receptivity.
We have an Internet site, www.steinmart.com, to promote Stein Mart’s fashion point of view, as well as provide information for
customers regarding stores, store locations, company management and selected sales promotion activity. We use steinmart.com to
highlight featured merchandise and for traffic stimulation; however, we do not sell merchandise online at this time. Visitors to the
website may apply for the Stein Mart Platinum MasterCard®, sign up to be Preferred Customers and/or purchase electronic gift
certificates.
DISTRIBUTION
We primarily utilize drop shipments from our vendors directly to our stores. We lease a small distribution/warehouse facility in
Jacksonville, Florida, where approximately three percent of our merchandise, on a dollar basis, was handled in 2008.
In 2009, we will begin the transition to a third party logistics network to deliver merchandise to the stores. We expect to complete the
implementation of this new supply chain in 2010. It will enable us to aggregate merchandise from numerous vendors at three store
distribution centers, where the merchandise will be prepared for delivery to the stores for immediate placement on the selling floor.
Transportation from the distribution centers to individual Stein Mart stores, also by third parties, will be coordinated to maximize
delivery efficiencies and store logistical considerations. The new supply chain is expected to be more cost effective and provide
greater operational control than the current system.
EMPLOYEES
As of January 31, 2009, our work force consisted of approximately 14,600 employees (8,400 40-hour equivalent employees). Each of
our stores employs an average of 51 persons as merchandising managers, service associates, cashiers and other positions. The
number of employees fluctuates based on the particular selling season.
TRADEMARKS
We own the federally registered trademark Stein Mart®, together with a number of other marks used in conjunction with our private
label merchandise program. Management believes that our trademarks are important, but with the exception of Stein Mart®, not
critical to our merchandising strategy.
AVAILABLE INFORMATION
Copies of our annual report on Form 10-K, proxy statement, quarterly reports on Form 10-Q, current reports on Form 8-K, and any
amendments to those filings are available free of charge on the investor relations portion of our website at http://ir.steinmart.com (click
on “SEC Filings”) as soon as reasonably practicable after they are filed electronically with the Securities and Exchange Commission.
In addition, proxy materials for the annual meeting of stockholders are also available at www.proxyvote.com. Also available free of
charge on the www.steinmart.com website (click on “Investor Relations”; click on “Corporate Governance”) are the charters for the
Audit Committee, the Compensation Committee, the Nominating and Corporate Governance Committee, as well as the Code of
Conduct and Corporate Governance Guidelines. Printed copies of these items are available free of charge upon request by writing
Stein Mart, Inc., 1200 Riverplace Boulevard, Jacksonville, FL 32207, Attention: Stockholder Relations.
ITEM 1A. RISK FACTORS
Our results of operations and financial condition can be adversely affected by numerous risks and uncertainties. The most important
of these risks and uncertainties are detailed below. You should carefully consider the risk factors described below and other risks
which may be disclosed from time to time in the Company’s filings with the SEC before investing in the Company’s securities. Should
any of these risks actually materialize, our business, financial condition, and future prospects could be negatively impacted.
Consumer sensitivity to economic conditions. The retail apparel business is dependent upon the level of consumer spending,
and as a fashion retailer, we rely on the expenditure of discretionary income for most, if not all, of our sales. The recent volatility in
the financial markets, worsening unemployment rates, rising personal bankruptcies, and lack of access to credit have all contributed
to erosion in consumer spending and consumer confidence in the past year. More specifically, a protracted housing downturn in
certain SunBelt states (Florida, California, Nevada and Arizona) where we have a large concentration of stores has had a chilling
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