Cabela's 2007 Annual Report Download - page 32

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26
Other significant items which directly impact comparisons of our operating results for 2007 were:
•new store pre-opening costs of $17 million in 2007 from the opening of eight new stores (six in the fourth
quarter, one late in the third quarter, and one in the second quarter), an increase of $7 million compared
to the pre-opening costs in 2006 from the opening of four stores;
•certain retail stores not meeting sales expectations;
•an increase in the proportion of lower margin hard goods sales to higher margin soft goods sales;
•costs from advertising and promotional strategies aimed at capturing additional market share; and
•increases in Financial Services revenue principally from growth in the number of average active credit
card accounts and average managed credit card loans, partially offset by higher credit card loan charge-
offs.
Current Year Achievements
2007 was highlighted by the opening of eight new store locations, our expansion into Canada through an
acquisition, and operational achievements outlined below.
Retail Store Openings – We opened eight new retail stores, increasing our total retail store square footage by
1.3 million square feet, or 49% of total retail space, and bringing our total square footage to over 4.0 million square
feet at the end of 2007.
Customer Service Enhancements – We completed implementation of customer service enhancements
directed at increasing sales and customer satisfaction in 10 of our retail stores including:
•in-store pick-up for catalog and Internet orders,
•installation of Internet kiosks, and
•the installation of catalog order desks.
We expect these customer service enhancements to be available in all existing retail stores in early 2008 and
are encouraged by early results.
Business Week magazine conducted its first ever Top 25 ranking of customer service champions – we ranked
No. 15 and were one of only two retailers to make the list.
Internet – Our Internet website continued to receive awards and high praise for excellence, including the
following awards and recognition:
• Our website was ranked in the top three among online retailers for reliability and responsiveness - an
indication of download page speed and completing transactions for customers, according to a study on
U. S. retail websites over the 2007 holiday season by research firm Keynote.
• The Cabelas.com website was listed in the annual “The Internet Retailer Hot 100 Retail Web Sites.”
Websites were selected for being innovative and engaging, creating striking and effective site designs, or
having certain critical features such as site search that was better than other sites.
• Our website was the most visited sporting goods industry eCommerce website according to a September
2007 publication from Hitwise, Incorporated, an online measurement company. Internet visits increased
by 30.2% in 2007 over 2006.
• Our website ranked among the top websites for total eCommerce sales (measured by industry
publications).
International Expansion – In September 2007, we acquired S.I.R. Warehouse Sports in Winnipeg, Manitoba,
which will serve as our platform for expansion into Canada.
Cabela’s CLUB Visa Credit Card – Our Cabela’s CLUB Visa credit card was ranked among the Top 5 in
customer satisfaction by Consumer Reports in a 2007 reader survey on their satisfaction as credit card holders.