David Griffith – Roth Capital Partners asked: Can you talk about the early openings on Black Friday and what impact they had? It seemed like you guys really held the line on promotions while the rest of the mall was going pretty crazy.
Richard M. Brooks – CEO responded: In retail, there tend to be patterns that repeat.
With the extended hours, from our perspective maybe because of our promotions or maybe lack of promotional strategy, we saw volume kind of moved out of the Friday and Saturday into that Thursday, Friday activity. We saw the same kind of activity last year and so expected we would probably see that same pattern again this year.
This is what happened.
For us, I think it’s about the weekend and the shifting of pattern into those new hours. I’m not so sure that the hours would have the necessary ones to make a big difference in the overall weekend. Again, maybe this is unique to us because the second part of your question is that we clearly were not as promotional as many other of our team peers.
In my comment about the relative promotional status, that’s not our business. We are reselling brands. We are reselling brands that are hard to find in many cases. We’re the only place you can find them in terms of most mall-based consumers and these are brands with real equity.
We’d be doing our brands a disservice by discounting, particularly the kind of all-store discounting that our competitors do.
Our position is that we want to be a great brand, a great partner for our branded suppliers, and that we have to (live up) to obligations to them in order do a good job representing them. This includes holding the line on brands where there is great value to them.
I believe we have some outstanding brands that are delivering value for us and themselves but more importantly, our consumers.
Edward Yruma – KeyBanc Capital Markets asked: I wanted to focus a little bit on the accessories business. This category had some phenomenal success last year and has been going through some slowdown this year. Is this a product cycle issue or distribution? Is there something to do to help improve those results?
Richard M. Brooks – CEO responded: I think we did and we got it out there. We did comp up in accessories here in November. We’re obviously again proud of what our buyers have achieved in that because we had some very difficult comparisons a year ago in this category.
These are product cycle-driven changes that we have in place.
As we look at what we do in every category–typically we always have categories that were going to plan down and ones we plan out based upon the trend cycles. Usually those will wash out within the departments and sometimes you see these department-driven cycles where you’ll be more of an apparel-driven business than you are an accessories business.
Last year we had a major run in terms of a trend in accessories; however, this year that has switched out into more apparel-driven and footwear-driven trends. Accessories have gone down as the category trended down.
Our buyers have done a great job repositioning within accessories to get those numbers to actually be a positive comp here in period ’10 in November. So, we did it again.
I’m not going to tell which categories drove those changes, but we had a few categories that combined make up for the strong trend we had last year. If that trend starts to lessen over the next number of months, we are hoping that again to see accessories come back to a more steady growth rate.