Vistaprint 2012 Annual Report Download - page 24

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We face risks related to interruption of our operations and lack of redundancy.
Our production facilities, websites, transaction processing systems, network infrastructure, supply chain
and customer sales, service and design operations may be vulnerable to interruptions, and we do not have
redundancies in all cases to carry on these operations in the event of an interruption. Some of the events that could
cause interruptions in our operations or systems are, among others:
• fire, flood, earthquake, hurricane or other natural disaster or extreme weather;
• labor strike, work stoppage or other issue with our workforce;
• political instability or acts of terrorism or war;
• power loss or telecommunication failure;
• attacks on our external websites or internal network by hackers or other malicious parties;
• undetected errors or design faults in our technology, infrastructure and processes that may cause our
websites to fail;
• inadequate capacity in our systems and infrastructure to cope with periods of high volume and demand,
particularly during promotional campaign periods and in the seasonal peak we experience in our
second fiscal quarter; and
• human error, including but not limited to poor managerial judgment or oversight.
In particular, both Bermuda, where substantially all of the computer hardware necessary to operate our
websites is located in a single facility, and Jamaica, our largest customer service, sales and design support
operation, are subject to a high degree of hurricane risk and extreme weather conditions.
We have not identified alternatives to all of our facilities, systems, supply chains and infrastructure,
including production, to serve us in the event of an interruption, and if we were to find alternatives, they may not be
able to meet our requirements on commercially acceptable terms or at all. In addition, we are dependent in part on
third parties for the implementation and maintenance of certain aspects of our communications and production
systems, and because many of the causes of system interruptions or interruptions of the production process may
be outside of our control, we may not be able to remedy such interruptions in a timely manner, or at all.
Any interruptions that cause any of our websites to be unavailable, reduce our order fulfillment performance
or interfere with our manufacturing, technology or customer service operations could result in lost revenue,
increased costs, negative publicity, damage to our reputation and brand, and an adverse effect on our business and
results of operations. Building redundancies into our infrastructure, systems and supply chain to mitigate these risks
may require us to commit substantial financial, operational and technical resources, in some cases before the
volume of our business increases with no assurance that our revenues will increase.
We face intense competition.
The markets for small business marketing products and services and home and family custom products,
including the printing and graphic design market, are intensely competitive, highly fragmented and geographically
dispersed. We expect competition to increase in the future. The increased use of the Internet for commerce and
other technical advances have allowed traditional providers of these products and services to improve the quality of
their offerings, produce and deliver those products and services more efficiently and reach a broader purchasing
public. Competition may result in price pressure, reduced profit margins and loss of market share, any of which
could substantially harm our business and results of operations. Current and potential competitors include:
• traditional storefront printing and graphic design companies;