Supercuts 2002 Annual Report Download - page 7

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Table of Contents
Diversification.
The Company has the ability to diversify its salon base through location and concept. This provides the Company flexibility to
meet consumer demand and demographics within the market.
The majority of the Company’s salons are in mall-based or strip center-based locations. The mall locations, which are aesthetically appealing
and designed to attract customers from mall shoppers, provide a steady source of new business. The Company’s strip center salons are
conveniently located in strip shopping centers with adequate traffic, appropriate trade area demographics, good visibility within the center or
from adjoining streets, effective signage, easy access and adequate parking. The Company also operates salons within Wal-Mart stores and
supercenters.
Regis’ North American salon concepts address the various customer preferences within the salon market. The Company’s regional mall salon
concepts provide the Company with the ability to have multiple locations within a single mall. Because the square footage for each of the mall-
based and strip center-based locations are approximately the same, the Company has the ability to determine which salon concept is best suited
to a location or change the concept of existing salons to meet customer preference or demographic changes in the salon’s market.
The Company also has salons located internationally in malls, leading department stores, mass merchants and high-street locations, and is
consistently focused on the moderate-to-upscale hair care and beauty market.
Expansion.
The Company has grown through increasing revenues from existing salons, constructing additional salons, and mergers and
acquisitions. Since 1995, the Company has added 7,150 net units (including franchised salons) to its worldwide salon base from new salon
construction as well as mergers and acquisitions. During this same period of time, the Company added several new salon concepts, including
SmartStyle, merged with Supercuts and The Barbers, and expanded its Regis Salons and MasterCuts concepts. In fiscal 2000, the Company
added 68 salons operating under the Supercuts name through its merger with Supercuts UK. In fiscal 2002, the Company added 523 salons
with its acquisition of the French franchise company Groupe Gerard Glemain (GGG), along with nearly 1,200 franchised salons with its
acquisition of the European franchisor Jean Louis David (JLD). In addition to continuing its salon acquisition strategy, the Company expects to
construct about 435 new company-owned salons and complete approximately 175 major remodeling and conversion projects during fiscal
2003.
The Company intends to focus future growth of salons in strip shopping centers across North America by adding company-owned salons and
assisting current and new franchisees in their expansion and market development. The Company believes its growth opportunities in strip
shopping centers of the retail hair care market in North America are vast and will complement the Company’s continuing growth of its mall-
based concepts. In addition, the Company plans to continue pursuing expansion opportunities by adding company-
owned and franchised salons
located in Wal-Mart stores and supercenters. The Company also plans to expand its European presence through franchising its recently
acquired brands in the GGG and JLD acquisitions.
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