Cabela's 2008 Annual Report Download - page 36

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31
Our 2008 operating results were impacted by a challenging retail and macroeconomic environment resulting
in slowed retail store and Direct sales, deterioration in merchandise gross margins from promotional and discounted
merchandise sales, and decreases in securitization income.
Other significant items which directly impact comparisons of our operating results for 2008 were:
• an increase in selling, distribution, and administrative expenses due to the addition of new stores in 2008
and 2007 and the infrastructure necessary to support this expansion;
• $10 million in breakage recorded in revenue and operating income where the probability of redemption is
remote on gift certificates, gift cards, and e-certificates;
• new store pre-opening costs of $8 million;
• restructuring and impairment charges in selling, distribution, and administrative expenses totaling $6
million; and
• Financial Services revenue decreasing principally from decreases in securitization income, higher spreads
and fees paid to investors on new securitizations, and related decreases in the valuation of our interest-only
strips associated with our securitized loans; mostly offset by growth in the number of active credit card
accounts, the associated loans, and interchange income.
Current Year Achievements
2008 was highlighted by the opening of two new stores, one of which incorporated our “next generation
store” format, the completion of our customer service enhancements, and operational achievements outlined further
below.
Retail Store Openings – Our two new stores increased our total retail store square footage by 200,000 square
feet bringing our total retail square footage to 4.3 million square feet at the end of 2008.
Customer Service Enhancements – We offered our customers integrated opportunities to access and use our
retail store, catalog, and Internet channels, including the completion of our customer service enhancements in the
first quarter of 2008. We completed implementation of customer service enhancements directed at increasing sales
and customer satisfaction in our retail stores including:
• in-store pick-up for catalog and Internet orders,
• installation of Internet kiosks, and
• the installation of catalog order desks.
Cabela’s was also listed among 14 companies featured in the book, The Customer Rules, which focuses on
excellence in customer service.
Retail Achievements – We were recognized as a top customer service retailer by the following:
• Incentive Magazine’s Platinum Partner Award for excellence recognizing us for delivery of quality products
and services in the incentive industry.
• Cabela’s rated in the top 10% for high-quality customer service by Gethuman, October 2008, a web site
dedicated to educating enterprises on the importance and cost savings of providing high-quality customer
service.
• Listed among the top retailers for superior customer service (poll conducted September 2008 by National
Retail Federation’s Foundation/American Express 2008 Customer Service survey).
• Included in the Top 11 for customer service rankings – ranked “Overall BEST” by BIGresearch, CIA in
September 2008.
We have also teamed up with Ford Motor Company to debut the Cabela’s Edition FX4 package on selected
F-Series trucks.