1、2021 ANNUAL REPORTSHYANNEHAWXCODY JAMESMOONSHINE SPIRITCODY JAMES WORKIDYLLWINDDear Shareholders,I would like to begin by reflecting on the past year and the challenges we all encountered as a result of COVID-19.Over the past 16 months,the world has faced unprecedented times,and many have suffered g
2、reatly due to the global health pandemic.I am personally grateful for our healthcare professionals,doctors and scientists who have worked tirelessly to take care of the sick and develop and distribute effective vaccines.I would also like to thank all those within the Boot Barn organization who have
3、demonstrated tremendous leadership as they continue to serve our customers.While there is still uncertainty in the external environment,I am more confident than ever in the resiliency of Boot Barn and the long-term potential that Boot Barn holds as the market leader in the western and work industry.
4、While this was a year of great challenges,it was also a year of great accomplishment for Boot Barn.Despite the impact from COVID-19 and subsequent macro-economic headwinds,we were able to achieve very strong results.Consolidated same store sales grew 3%,cycling 5%same store sales growth in fiscal 20
5、20 and 10%growth in the prior year.Our continued focus on full-price selling and commitment to profitability drove consolidated operating profit growth of 100 basis points during fiscal 2021,to 9.7%from 8.7%in fiscal 2020.Earnings per diluted share grew 23%on a tax adjusted basis.We are extremely pl
6、eased with the earnings power demonstrated by the business given the myriad of challenges over the last year.We are continuing to build a national lifestyle retail brand by focusing on the execution of each of Boot Barns four strategic initiatives,including:1.Driving same-store sales growth 2.Streng
7、thening our omni-channel leadership Same store sales in our e-commerce business increased 23.6%for the year.Our continued focus on improvement in e-commerce profitability helped drive a significant increase in e-commerce EBIT during the fiscal year.Several omni-channel initiatives we implemented ove
8、r the past two years,including buy online pick-up in store,buy online curbside pickup,in-store fulfillment,same day delivery and buy online return in store,were well received by our customers.We continue to develop faster and more effective ways to deliver e-commerce orders to our customers,further
9、enhancing customer service and mitigating freight costs.Additionally,we are using many of these new capabilities to drive increased traffic to the stores which is helping us to both drive incremental store sales as well as grow the percent of our customers that shop across both channels.These capabi
10、lities should serve us well going forward as they drive customer loyalty and strengthen our competitive position against pure e-commerce players.As we look to fiscal 2022,our focus will remain on augmenting our omni-channel service offerings while continuing to build the profitability of that channe
11、l.3.Increasing the penetration of our exclusive brand portfolio and expanding our merchandise margin Same store sales growth in our stores improved significantly as the year progressed.Decreased traffic in our stores resulting from customers staying at home in response to the COVID-19 crisis and tem
12、porary store closures led to a same store sales decline in our retail stores during the first half of the year of more than 17%.A strong holiday quarter,a much-improved macroeconomic environment,and contributions from our field team drove significant increases in our retail store same store sales in
13、 the second half of the year,which culminated in a retail store same store sales decline of only 1%for the year.The improvement in sales as the year progressed was broad-based and across nearly all merchandise categories and geographic regions.During the year we also created the Just Country segment
14、.As part of this initiative,we augmented our assortment of hiking boots,outerwear,casual footwear and apparel.We believe that this work,coupled with advantageous consumer trends towards being outdoors and dressing more casually,has enabled us to further increase sales and capture a broader group of
15、customers that will serve us well for ongoing growth in the future.We are extremely proud of the outsized growth we have experienced in this portion of our business.Our fiscal 2021 exclusive brand penetration grew approximately 170 basis points over the prior year,to 23.7%.We are very pleased with o
16、ur penetration growth despite the challenges we have faced as a result of COVID-19.The high-quality nature of our exclusive product is evidenced by their representation as top selling brands in our stores.Cody James,Shyanne,Idyllwind,and Hawx were each in our top 10 selling brands in the store durin
17、g the year.As we look to fiscal 2022,we have already seen nice improvement in the supply chain.As a result,we expect exclusive brand penetration to return to approximately 250 basis points of growth in fiscal 2022.4.Expanding our store base Adding new stores in attractive markets continues to be an
18、important growth driver for sales and market share for Boot Barn.During this past year,we added 15 stores,bringing our total store count to 273 stores across 36 states.We are pleased with our new store performance during fiscal 2021,given the difficult environment and uncertainty with how new stores
19、 would perform during the pandemic.New stores opened this past year have exceeded our sales plans and are expected to payback within our targeted 3-year period or better.While fiscal 2021 proved to be a challenging year,I am proud of the resiliency of this organization and the overall strength of th
20、e Boot Barn model.We have proven our ability to navigate as a company through difficult times,and I believe we will continue to fortify our leadership position in the western and work industry.I am looking forward to fiscal 2022 and the opportunities we have to continue to build the business.Sincere
21、ly,Jim UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington,D.C.20549 FORM 10-K (Mark One)ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended March 27,2021 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT
22、 OF 1934 For the transition period from to Commission file number:001-36711 BOOT BARN HOLDINGS,INC.(Exact name of registrant as specified in its charter)Delaware(State or other jurisdiction of incorporation or organization)90-0776290(I.R.S.Employer Identification No.)15345 Barranca Pkwy Irvine,CA 92
23、618(Address of principal executive offices)(Zip Code)Registrants telephone number,including area code:(949)453-4400 Securities registered pursuant to Section 12(b)of the Act:Title of each class Trading Symbol Name of each exchange on which registered Common Stock,$0.0001 par value BOOT New York Stoc
24、k Exchange Securities registered pursuant to Section 12(g)of the Act:None Indicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the Securities Act.Yes No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Se
25、ction 15(d)of the Act.Yes No Indicate by check mark whether the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 during the preceding 12 months(or for such shorter period that the registrant was required to file such reports),and(2)
26、has been subject to such filing requirements for the past 90 days.Yes No Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T(232.405 of this chapter)during the preceding 12 months(or fo
27、r such shorter period that the registrant was required to submit such files).Yes No Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,a smaller reporting company,or an emerging growth company.See the definitions of“large accelerat
28、ed filer,”“accelerated filer,”“smaller reporting company,”and“emerging growth company”in Rule 12b-2 of the Exchange Act.Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company,indicate by check mark if the regist
29、rant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a)of the Exchange Act.Indicate by check mark whether the registrant has filed a report on and attestation to its managements assessment of t
30、he effectiveness of its internal control over financial reporting under Section 404(b)of the Sarbanes-Oxley Act(15 U.S.C.7262(b)by the registered public accounting firm that prepared or issued its audit report.Indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2
31、of the Act).Yes No The aggregate market value of the registrants common stock held by non-affiliates of the registrant as of the end of its most recently completed second fiscal quarter was approximately$593.2 million.Shares held by each officer,director and person owning more than 10%of the outstan
32、ding voting and non-voting stock have been excluded from this calculation because such persons may be deemed to be affiliates of the registrant.This determination of potential affiliate status is not necessarily a conclusive determination for other purposes.Shares held include shares of which certai
33、n of such persons disclaim beneficial ownership.The number of outstanding shares of the registrants common stock,$0.0001 par value,as of May 10,2021 was 29,251,626.DOCUMENTS INCORPORATED BY REFERENCE Portions of the Registrants Proxy Statement for the 2021 Annual Meeting of Stockholders,to be filed
34、pursuant to Regulation 14A within 120 days after the end of the 2021 fiscal year,are incorporated by reference into Part III of this Form 10-K.TABLE OF CONTENTS Page PART I Item 1.Business 2 Item 1A.Risk Factors 14 Item 1B.Unresolved Staff Comments 37 Item 2.Properties 37 Item 3.Legal Proceedings 38
35、 Item 4.Mine Safety Disclosures 38 PART II Item 5.Market for Registrants Common Equity,Related Stockholder Matters and Issuer Purchases of Equity Securities 39 Item 6.Selected Consolidated Financial Data 40 Item 7.Managements Discussion and Analysis of Financial Condition and Results of Operations 4
36、3 Item 7A.Quantitative and Qualitative Disclosures About Market Risk 58 Item 8.Consolidated Financial Statements and Supplementary Data 59 Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 92 Item 9A.Controls and Procedures 92 Item 9B.Other Information 94 PA
37、RT III Item 10.Directors,Executive Officers and Corporate Governance 95 Item 11.Executive Compensation 95 Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 95 Item 13.Certain Relationships and Related Transactions,and Director Independence 95 Item
38、 14.Principal Accounting Fees and Services 95 PART IV Item 15.Exhibits and Financial Statement Schedules 95 1 Fiscal Year We operate on a fiscal calendar that results in a 52-or 53-week fiscal year ending on the last Saturday of March unless April 1st is a Saturday,in which case the fiscal year ends
39、 on April 1st.In a 52-week fiscal year,each quarter includes thirteen weeks of operations;in a 53-week fiscal year,the first,second and third quarters each include thirteen weeks of operations and the fourth quarter includes fourteen weeks of operations.The data presented contains references to fisc
40、al 2021,fiscal 2020,and fiscal 2019,which represent our fiscal years ended March 27,2021,March 28,2020 and March 30,2019,respectively.Fiscal 2021,2020 and 2019 were each 52-week periods.2 PART I Item 1.Business.Our Company We are the largest lifestyle retail chain devoted to western and work-related
41、 footwear,apparel and accessories in the United States.With 273 stores in 36 states as of March 27,2021,we have more than three times as many stores as our nearest direct competitor that sells primarily western and work wear,and believe we have the potential to grow our domestic store base to 500 st
42、ores.Our stores,which are typically freestanding or located in strip centers,average 10,500 selling square feet and feature a comprehensive assortment of brands and styles,coupled with attentive,knowledgeable store associates.We target a broad and growing demographic,ranging from passionate western
43、and country enthusiasts to workers seeking dependable,high-quality footwear and apparel.We strive to offer an authentic,one-stop shopping experience that fulfills the everyday lifestyle needs of our customers and,as a result,many of our customers make purchases in both the western and work wear sect
44、ions of our stores.Our store environment,product offering and marketing materials represent the aesthetics of the true American West,country music and rugged,outdoor work.These threads are woven together in our motto,“Be True”,which communicates the genuine and enduring spirit of the Boot Barn brand
45、.Our product offering is anchored by an extensive selection of western and work boots and is complemented by a wide assortment of coordinating apparel and accessories.Many of the items that we offer are basics or necessities for our customers daily lives and typically represent enduring styles that
46、are not meaningfully impacted by changing fashion trends.Accordingly,approximately 75%of our store inventory is kept in stock through automated replenishment programs.Our boot selection,which comprises approximately one-third of each stores selling square footage space,is merchandised on self-servic
47、e fixtures with western boots arranged by size and work boots arranged by style and function.This allows us to display the full breadth of our inventory and deliver a convenient shopping experience.We also carry market-leading assortments of denim,western shirts,cowboy hats,belts and belt buckles,we
48、stern-style jewelry and accessories.Our western assortment includes many of the industrys most sought-after brands,such as Ariat,Cinch,Cody James,Corral,Dan Post,Durango,El Dorado,Idyllwind,Justin,Laredo,Lucchese,Miss Me,Montana Silversmiths,Moonshine Spirit,Shyanne,Stetson,Tony Lama,Twisted X,Resis
49、tol and Wrangler.Our work assortment includes rugged footwear,outerwear,overalls,denim and shirts for the most physically demanding jobs where durability,performance and protection matter,including safety-toe boots and flame-resistant and high-visibility clothing.Among the top work brands sold in ou
50、r stores are Carhartt,Cody James Work,Dickies,Georgia Boot,Hawx,Thorogood,Timberland Pro and Wolverine.Our merchandise is also available on our e-commerce websites.Boot Barn was founded in 1978 and,over the past 43 years,has grown both organically and through successful strategic acquisitions of com
51、peting chains.We have rebranded and remerchandised the acquired chains under the Boot Barn banner.We believe that our business model and scale provide us with competitive advantages that have contributed to our consistent and strong financial performance,generating sufficient cash flow to support na
52、tional growth.Acquisitions G.&L.Clothing,Inc.On August 26,2019,Boot Barn,Ipleted the acquisition of G.&L.Clothing,Inc.(“G.&L.Clothing”),an individually-owned retailer operating one store in Des Moines,Iowa.As part of the transaction,Boot Barn,Inc.purchased the inventory,entered into new leases with
53、the stores landlord and offered employment to the G.&L.Clothing team.The primary reason for the acquisition of G.&L.Clothing was to further expand the Companys retail operations in Iowa.The cash consideration paid for the acquisition was$3.7 million.Drysdales,Inc.On July 3,2018,Boot Barn,Ipleted the
54、 acquisition of assets from Drysdales,Inc.(“Drysdales”),a retailer with two stores in Tulsa,Oklahoma.As part of the transaction,Boot Barn,Inc.purchased the inventory,entered 3 into new leases with the stores landlord,offered employment to the Drysdales team at both store locations and assumed certai
55、n customer credits.The primary reason for the acquisition of Drysdales was to further expand the Companys retail operations in Oklahoma.The cash consideration paid was$3.8 million.Lone Star Western&Casual LLC On April 24,2018,Boot Barn,Ipleted the acquisition of Lone Star Western&Casual LLC(“Lone St
56、ar”),an individually owned retail company with three stores in Waxahachie,Corsicana and Athens,Texas.As part of the transaction,Boot Barn,Inc.purchased the inventory,entered into new leases with the stores landlord and offered employment to the Lone Star team at all three store locations.The primary
57、 reason for the acquisition of Lone Star was to further expand the Companys retail operations in Texas.The cash consideration paid for the acquisition was$4.4 million.Woods Boots Asset Acquisition On September 11,2017,we acquired assets from Woods Boots,a four-store family-owned retailer with stores
58、 in Midland and Odessa,Texas.As part of the transaction,we purchased the inventory,entered into new leases with the stores landlord,offered employment to the Woods Boots team at all four store locations and assumed certain customer credits.Based on the fair value analysis of the net assets acquired
59、and liabilities assumed,the inventory was valued at$2.8 million,and the customer credits were valued at less than$0.1 million.Country Outfitter Asset Acquisition On February 16,2017,we acquired all rights and interest in the website and tradename,along with the associated social media platforms.We a
60、dditionally purchased a customer email list and assumed Country Outfitters merchandise credits.The Country Outfitter e-commerce website sells primarily country and western fashion merchandise.The Country Outfitter assets were purchased for$1.8 million of cash and assumed liabilities.The Company oper
61、ates as a website separate from its other e-commerce sites.Sheplers Acquisition On June 29,2015,we acquired Sheplers,Inc.and Sheplers Holding Corporation(collectively with Sheplers,Inc.“Sheplers”),a western lifestyle company with 25 retail locations across the United States and an e-commerce busines
62、s.We refer to the acquisition as the“Sheplers Acquisition”.We financed the Sheplers Acquisition with borrowings under a senior secured asset-based revolving credit facility for which Wells Fargo Bank,National Association is agent(the“June 2015 Wells Fargo Revolver”),and a syndicated senior secured t
63、erm loan for which GCI Capital Markets LLC is agent(the“2015 Golub Term Loan”).Through the Sheplers Acquisition,we added eight new markets,expanded both our Texas(Dallas and San Antonio)and Denver markets,and greatly increased our omni-channel capabilities as Sheplers had a leading e-commerce platfo
64、rm(“Sheplers e-commerce”).We rebranded 19 of the 25 retail stores acquired through the Sheplers Acquisition,and closed the remaining six stores during fiscal 2016.Our Competitive Strengths We believe the following strengths differentiate us from our competitors and provide a solid foundation for fut
65、ure growth:Powerful lifestyle brand.The Boot Barn brand is built on western lifestyle values that are core to American culture.Our deep understanding of this lifestyle enables us to create long-lasting relationships with our customers who embody these ideals.Our brand is highly visible through our s
66、ponsorship of local and national rodeos,stock shows,concerts and country music artists.We sell our products through pop-up shops at several of the largest events that we sponsor.We believe these grassroots marketing efforts make our brand synonymous with the western lifestyle,validate our brands aut
67、henticity and establish Boot Barn as the trusted specialty retailer for all of our customers everyday needs.4 Strong e-commerce positioning.We offer a compelling shopping experience to our customers,including 273 brick-and-mortar stores combined with our e-commerce websites consisting primarily of ,
68、 and .B and offer a compelling every-day low price shopping experience catered towards a lifestyle customer with western roots and a strong work influence.C has a curated assortment appealing to a more fashion-based country lifestyle customer.Each of our e-commerce sites has distinct brand positioni
69、ng and provides a differentiated shopping experience to our customers.Fast growing specialty retailer of western and work wear in the U.S.Our broad geographic footprint,which currently spans 36 states,provides us with significant economies of scale,enhanced supplier relationships,the ability to recr
70、uit and retain high quality store associates and the ability to reinvest in our business at levels that we believe exceed those of our competition.Loyal customer base.Our customers come to us for many aspects of their everyday footwear and clothing needs because of the breadth and availability of ou
71、r product offering.Our customer loyalty program,B Rewarded,enhances our connection and relationship with our customers.Our loyalty program has grown rapidly since its inception in fiscal 2011 and as of March 27,2021 includes approximately 4.7 million members who have purchased merchandise from us in
72、 the last three fiscal years.The majority of our sales are made to these customers.We leverage this database,which provides useful information about our customers,to enhance our marketing activities across our stores and e-commerce websites,refine our merchandising and planning efforts and assist in
73、 our selection of sites for new stores.Differentiated shopping experience.We deliver a one-stop shopping experience that engages our customers and,we believe,fulfills their lifestyle needs.Our stores are designed to create an inviting and engaging experience and include prominent storefront signage,
74、a simple and easy-to-shop layout and a large and conveniently arranged self-service selection of boots.We offer significant inventory breadth and depth across a range of boots,apparel and accessories.Additionally,all of our stores are equipped with touch screen devices that allow our customers to ac
75、cess millions of additional boots,apparel and other items from our e-commerce warehouse inventory as well as the inventory at most of our larger third-party vendors,purchase these items in store,and,in most cases,receive free shipping.We also have touch screen devices that allow customers to browse
76、our in-store assortment and select an item that meets their functional requirements and preferences.In fiscal 2021,we continued to enhance customer service with our omni-channel initiatives,including buy online pick up in-store,buy online pick up curbside,buy online return in store,buy online ship f
77、rom store,and same day delivery.We believe that our strong,long-lasting supplier relationships enhance our ability to provide a compelling merchandise assortment with a strong in-stock position both in-store and online.Our knowledgeable store associates are passionate about our merchandise and deliv
78、er a high level of service to our customers.These elements help promote customer loyalty and drive repeat visits.Compelling merchandise assortment and strategy.We believe we offer a diverse merchandise assortment that features the most sought-after western and work wear brands,well-regarded niche br
79、ands and exclusive private brands across a range of merchandise categories including boots,apparel and accessories.We have a core assortment of styles that serves as a foundation for our merchandising strategy and we augment and tailor that assortment by region to cater to local preferences.Portfoli
80、o of exclusive private brands.We have leveraged our scale,merchandising experience and customer knowledge to launch a portfolio of private brands exclusive to us,which primarily include Shyanne,Cody James,Moonshine Spirit,Idyllwind,Hawx,Cody James Work,and El Dorado.Our private brands are currently
81、available in stores,on , and and offer high-quality western and work boots as well as apparel and accessories for men,ladies and kids.Each of our private brands,which address product and price segments that we believe are underserved by third-party brands,offers exclusive products to our customers a
82、nd has historically achieved better merchandise margins than the third-party brands that we carry.Customer receptivity and demand for our private brands have been strong,demonstrated by the increasing penetration of private brands and sales momentum across our store base and e-commerce websites.Vers
83、atile store model with compelling unit economics.We have successfully opened and currently operate stores that generate strong cash flow,consistent store-level financial results and an attractive return on investment across a variety of geographies,markets,store sizes and location types.We operate s
84、tores in markets characterized as 5 agribusiness centers and ranch regions,and in other various geographies throughout the United States.Our stores are also successful in small,rural towns,suburban and major metropolitan areas.Our new store model requires an average net cash investment of approximat
85、ely$0.8 million and targets an average payback period of three years.Our lean operating structure,coupled with our strong supplier relationships,has allowed us to grow with minimal supply chain investments as most of our products ship directly from our suppliers to our stores.We believe that our pro
86、ven retail model and attractive unit economics support our ability to grow our store footprint in both new and existing markets across the U.S.Highly experienced management team and passionate organization.Our senior management team has extensive experience across all key retail disciplines and has
87、been instrumental in developing a robust and scalable infrastructure to support our growth.In addition to playing an important role in developing our long-term growth initiatives,our senior management team embraces the genuine and enduring qualities of the western and work lifestyle and has created
88、a positive culture of enthusiasm and entrepreneurial spirit which is shared by team members throughout our entire organization.Our Growth Strategies We are pursuing several strategies to continue our profitable growth,including:Continuing omni-channel leadership.Our growing national footprint,social
89、 media following and broader marketing efforts drive traffic to our stores and e-commerce websites.We operate our e-commerce websites as an alternative to shopping in the stores,which allows us to reach customers outside our geographic footprint.We continue to make investments in both online and in-
90、store advertising,aimed at increasing traffic to our e-commerce websites,which reached more than 69 million total visits in fiscal 2021 compared to more than 63 million total visits in fiscal 2020,and increasing the amount of merchandise purchased by customers who visit our websites,while improving
91、the shopping experience for our customers.Additionally,all of our stores are equipped with touch screen devices that allow our customers to access millions of additional boots,apparel and other items from our e-commerce warehouse inventory as well as the inventory at most of our larger third-party v
92、endors,purchase these items in store,and,in most cases,receive free shipping.We also have touch screen devices that allow customers to browse our in-store assortment and select an item that meets their functional requirements and preferences.In fiscal 2021,we continued to enhance customer service wi
93、th our omni-channel initiatives,including buy online pick up in-store,buy online pick up curbside,buy online return in store,buy online ship from store,and same day delivery.We have also made investments in our e-commerce infrastructure,including adding automation to our warehouses to support expand
94、ing e-commerce growth.Our e-commerce sales as a portion of total consolidated net sales were 18.6%and 15.9%in fiscal 2021 and fiscal 2020,respectively.Driving same store sales growth.We believe that we can continue to grow our same store sales by increasing our brand awareness,driving additional tra
95、ffic to our stores and e-commerce websites and increasing the amount of merchandise purchased by customers while visiting both our stores and e-commerce channels.Our management team has several initiatives in place to accelerate growth,enhance our store associates selling skills,drive store-level pr
96、oductivity and increase customer engagement through our loyalty program.Building our private brand portfolio.We believe we can achieve gross margin enhancement by increasing the penetration of our private brand sales.As of March 27,2021,our private brands primarily include Shyanne,Cody James,Moonshi
97、ne Spirit,Idyllwind,Hawx,Cody James Work,and El Dorado,and are sold in our stores and on our e-commerce websites.Each of our private brands,which address product and price segments that we believe are underserved by third-party brands,offers high quality exclusive products to our customers and has h
98、istorically achieved better merchandise margins than the third-party brands that we carry.Expanding our store base.Driven by our compelling store economics,we believe that there is a significant opportunity to expand our store base in the U.S.During fiscal 2021,we opened 15 new stores with no acquis
99、itions.We typically rebrand acquired stores within twelve months from the date of acquisition.Based on an extensive analysis,we believe that we have the potential to grow our domestic store base of 273 stores as of March 27,2021 to approximately 6 500 stores over time.Over the long-term we plan to t
100、arget store openings in new and existing markets and in adjacent and underserved markets that we believe will be receptive to our concept.Over the past several years,we have made investments in personnel,information technology,warehouse infrastructure and e-commerce platforms to support the expansio
101、n of our operations.Leveraging our economies of scale.We believe that we have a variety of opportunities to increase the profitability of our business over time.Our ability to leverage our infrastructure and drive store-level productivity due to economies of scale is expected to be a primary driver
102、of our improvement in profitability.We intend to continually refine our merchandise mix and increase the penetration of our private brands to help differentiate us from our competitors and achieve higher merchandise margins.We also expect to capitalize on additional economies of scale in purchasing
103、and sourcing as we grow our geographic footprint and online presence.Enhancing brand awareness.We intend to enhance our brand awareness and customer loyalty in a number of ways,such as continuing to grow our store base and our online and social media initiatives.We use broadcast media such as radio,
104、television and outdoor advertisements to reach customers in new and existing markets.We also maintain our strong market position through our grassroots marketing efforts,including sponsorship of rodeos,stock shows and other western industry events,as well as our association with country music,includ
105、ing partnerships with Miranda Lambert and Brad Paisley and up-and-coming country musicians.We have an effective social media strategy with high customer engagement,as evidenced by our strong following on Facebook and Instagram.Our Market Opportunity We participate in the large,growing and highly fra
106、gmented western and work wear markets of the broader apparel and footwear industry.We offer a variety of boots,apparel and accessories that are basics or necessities for our customers daily lives.Many of our customers are employed in the agriculture,oil and gas,manufacturing and construction industr
107、ies,and are often country and western enthusiasts.We believe that growth in the western wear market has been and will continue to be driven by the growth of western events,such as rodeos,the popularity of country music and the continued strength and endurance of the western lifestyle.As a result of
108、the coronavirus(“COVID-19”)pandemic,public and private sector policies and initiatives intended to reduce the transmission of COVID-19,such as the imposition of travel restrictions,mandates from federal,state and local authorities to avoid large gatherings of people,quarantine or“shelter-in-place”,a
109、nd the promotion of social distancing significantly impacted events around the country.As a result of these initiatives,many large public events including rodeos,concerts and country music festivals were cancelled or otherwise postponed.We believe additional cancellations and postponements will nega
110、tively impact near-term growth in the western wear market.We believe that growth in the work wear market has been and will continue to be driven by increasing activity in construction and manufacturing.Additionally,government regulations for workplace safety have driven and,we believe,will continue
111、to drive,sales in specific categories,such as safety-toe boots and flame-resistant and high-visibility clothing for various industrial and outdoor occupations.The COVID-19 global pandemic resulted in an economic slowdown impacting many industries and both public and private sector jobs.As a result o
112、f this pressure,the global demand for oil was significantly impacted and drove the price of oil down.We believe these factors could negatively impact near-term growth in the work wear market.Our Sales Channels During fiscal 2021,we continued to enhance our omni-channel capabilities.Our current omni-
113、channel presence consists of both brick-and-mortar stores as well as an e-commerce platform,consisting primarily of , and .Our stores As a lifestyle retail concept,our stores offer a broad array of merchandise to outfit an entire family,while working during the week,relaxing on the weekend,or dressi
114、ng up for an evening out.Our stores are easy to navigate with clear sight lines to all major product categories.Our preferred store layout has ladies and childrens apparel on one side of the store and mens western and mens work apparel on the other side.Our basic denim is usually merchandised on she
115、lving placed on the exterior walls,while our premium-priced,more stylized denim and clothing are prominently 7 displayed on floor fixtures and mannequins.We utilize the space in the front of the store for accessories such as hats,belts,jewelry,handbags,home merchandise,gifts and various impulse purc
116、hase items.Boots,our signature category,anchor the rear of the store with an expansive assortment displayed on fixtures up to six shelves in height.We offer virtually all of our boots in pairs out on the sales floor.To reflect the typical purchasing decision process of each of our customer segments,
117、we arrange all western boots by size and all work boots by function and brand.While our knowledgeable and friendly store associates are readily available to assist our customers,the store design facilitates a self-service shopping experience.Our stores are generally located in or near high visibilit
118、y,power and large neighborhood shopping centers with trade areas of five or more miles.Our stores average 10,500 selling square feet and feature a comprehensive assortment of brands and styles,coupled with attentive,knowledgeable store associates.Our stores are designed and managed to drive profitab
119、ility and,we believe,create a compelling customer shopping experience.During fiscal 2021,we opened 15 new stores.As of March 27,2021,our retail footprint included 273 stores in 36 states across the U.S.Two of our stores are operated under the“American Worker”name.Our American Worker stores primarily
120、 feature work-related footwear,apparel and accessories.We do not currently intend to open additional American Worker stores.8 The following table shows the number of stores in each of the 36 states in which we operated as of March 27,2021.Number of State stores Alabama 2 Arkansas 1 Arizona 14 Califo
121、rnia 53 Colorado 13 Florida 8 Georgia 3 Idaho 3 Illinois 1 Indiana 4 Iowa 6 Kansas 4 Kentucky 3 Louisiana 6 Minnesota 3 Mississippi 1 Missouri 2 Montana 4 Nebraska 2 Nevada 11 New Mexico 7 North Carolina 6 North Dakota 6 Ohio 2 Oklahoma 8 Oregon 4 Pennsylvania 4 South Carolina 3 South Dakota 2 Tenne
122、ssee 10 Texas 58 Utah 2 Virginia 3 Washington 4 Wisconsin 1 Wyoming 9 Total 273 E-commerce Our e-commerce websites are an integral part of our brand and allow us to further build awareness in our current markets and reach customers not served by our current geographic footprint.During fiscal 2021,we
123、 had more than 69 million total visits to our websites and we sold merchandise to customers in all 50 states.Approximately 3.3%of our total e-commerce revenue for fiscal 2021 was generated from customers outside of the United States.Such foreign-source revenue constituted approximately 0.6%of our ov
124、erall net sales in fiscal 2021.Our growing national footprint and broader marketing efforts drive traffic to our website,which in turn also drives traffic to our stores.We believe that many customers,especially those shopping for boots,browse online at and then visit our stores to make their purchas
125、es to ensure a proper fit.As a multi-channel 9 retailer,we are implementing technology initiatives that integrate in-store and e-commerce platforms into one seamless customer experience.As an example,we have implemented in-store touch screen devices to expand the product offering available to our in
126、-store customers,including additional styles,colors and sizes not carried in the store.In fiscal 2021,we continued to enhance customer service with our omni-channel initiatives,including buy online pick up in-store,buy online pick up curbside,buy online return in store,buy online ship from store,and
127、 same day delivery.Our e-commerce businesses are every-day low price models.For all of our e-commerce brands,we communicate information on current promotions and upcoming events on our e-commerce websites,which helps drive purchases online and traffic to our stores.We continue to improve follow-up e
128、mail communication related to order confirmations,as well as offer boot care and other accessories associated with boot purchases.Store expansion opportunities and site selection We have substantial experience in opening stores in new and existing geographic markets.During the last three fiscal year
129、s,we have successfully added,on a net basis,47 new stores through a combination of organic growth and strategic acquisitions.We evaluate potential new locations in light of a variety of criteria,including local demographics and population,the areas industrial base,the existing competitive landscape,
130、occupancy costs,store visibility,traffic,environmental considerations,co-tenancy and accessibility.We also consider a regions total store potential to help ensure efficiencies in store management and media spending.Most of our stores are in high-traffic and highly visible locations and many have fre
131、eway signage.Stores located in metropolitan areas are typically established in high-density neighborhoods,and stores located in rural areas are typically established near highways or major thoroughfares.Based on an extensive internal analysis of our current customer base,store performance drivers an
132、d competitor penetration,we believe that the U.S.market supports the ability to grow our current domestic store base to approximately 500 stores.We utilized multiple methods for measuring market size,including a review of demographic and psychographic factors on a state-by-state basis.We supplemente
133、d that data by analyzing our share of the geographic markets in which we currently operate and extrapolating that share to new geographic markets.Based on our market analysis,we have created a regional and state-by-state development plan to strategically extend our store portfolio.Careful considerat
134、ion was given to operational constraints and merchandising differences in new and existing markets,while balancing the relevant risks associated with opening stores in those markets.Over the past several years,we have invested in construction and real estate resources,information technology and ware
135、house infrastructure to support the expansion of our operations.In addition,we have developed a model for new stores that assumes a leased 8,000 to 12,000 square foot space,requires an average net cash investment of approximately$0.8 million and targets an average payback period of three years.We be
136、lieve that under this model we can grow our store base by approximately 10%annually over the next several years without substantially modifying our current resources and infrastructure.Store Management and Training We have a strong culture focused on providing superior customer service.We believe th
137、at our store associates and managers form the foundation of the Boot Barn brand.We recruit people who are welcoming,friendly and service-oriented,and who often live the western lifestyle or have a genuine affinity for it.We have a positive culture of enthusiasm and entrepreneurial spirit throughout
138、the Company,which is particularly strong in our stores.Given the lifestyle nature of the Boot Barn brand,we have developed a natural connection between our customers and our store associates.Given the importance of both fit and function in selling much of our product,we utilize a well-developed sale
139、s,service and product training program.We provide over 20 hours of training for new store associates,as well as ongoing product,sales and leadership training.Additionally,we provide home office and supplier-led workshops on products,selling skills and leadership at our annual three-day store manager
140、 meeting.Our store management training programs emphasize building skills that lead to effective store management and overall leadership.Our store managers are responsible for hiring and staffing our stores and are empowered with the sales,customer service and operational tools necessary to monitor
141、employee and store performance.We believe that our continued investments in training our 10 employees help drive loyalty from our store associates and,in turn,our customers.We are committed to providing the right merchandise solution for each of our customers based on the ultimate end use of our pro
142、ducts.Our goal is to train each of our store associates to be able to guide a customer throughout a store and provide helpful knowledge on product fit,functions and features across our departments.Rather than rely heavily on sales commissions and supplier-specific incentive programs,we utilize a sys
143、tem under which the vast majority of our store associates compensation is based on an hourly wage.We believe that this produces a team-oriented culture,creates a less pressured selling environment and helps ensure that our store associates are focused on the specific needs of our customers.Merchandi
144、sing Strategy We seek to establish our stores as a one-stop destination for western and work-related footwear,apparel and accessories.Our merchandising strategy is to offer a core assortment of products,brands and styles by store,department and price point.We augment and tailor this assortment by re
145、gion to cater to local preferences such as toe profiles for western boots,styling for western apparel,and functions and features for work apparel and work boots depending on climate and the local industries served.In addition,we actively maintain a balance between third party brands and our own bran
146、ds that,we believe,offers our customers a compelling mix between selection,product and value.Our business is moderately seasonal and as a result our revenues fluctuate from quarter to quarter.The third quarter of our fiscal year,which includes the Christmas shopping season,has historically produced
147、higher sales and disproportionately higher operating results than the other quarters of our fiscal year.Historically,neither the western nor the work component of our business has been meaningfully impacted by fashion trends or seasonality.We believe that many of our customers are driven primarily b
148、y utility and brand,and our best-selling styles tend to be items that carry over from year to year with only minor updates.In fiscal 2021,fiscal 2020 and fiscal 2019 we generated approximately 34%,34%and 33%of our net sales during our third fiscal quarter,respectively.We have a minimal amount of sea
149、sonal merchandise that could necessitate significant markdowns.This allows us to implement automated replenishment systems for approximately 75%of our store merchandise,meaning that,as sales are captured in a stores point of sale system,recommended purchase orders are systematically generated for ap
150、proval by our merchandising group,ensuring our strong in-stock inventory position.As a result,demand and margins for the majority of our products are fairly predictable,which reduces our inventory risk.Unfavorable economic conditions,including those caused by COVID-19,could leave us with either exce
151、ss inventory or a shortage of inventory and increased pressure on our margins.For more information about the risks,uncertainties,and other factors that could affect our future results,please see Item 1A,Risk Factors,of this Annual Report on Form 10-K.Our products During fiscal 2021,our products cont
152、ributed to overall sales in the following manner:GenderMens merchandise accounted for approximately 65%of our sales with the balance being ladies,kids and unisex merchandise.StylingWestern styles comprised approximately two thirds of our sales,with work-related and other styles making up the balance
153、.Product categoryBoots accounted for just over half of our sales,with apparel comprising an additional 32%and the balance consisting of hats,gifts,accessories and home merchandise.Throughout our long history we have maintained collaborative relationships with our key suppliers.These relationships,co
154、upled with our scale,have allowed us to carry a wide selection of popular and niche brands,including Ariat,Carhartt Workwear,Cinch,Corral,Dan Post,Georgia Boot,Justin Boots,Keen,Lucchese,Rocky,Stetson,Timberland,Tony Lama,Twisted X,Wolverine and Wrangler.In many cases,we are one of the largest accou
155、nts of our suppliers and have become important as the largest specialty retailer of western and work wear in the U.S.As a result,11 we have several advantages relative to our competitors,including increased buying power and access to first-to-market or limited-edition products.This provides us with
156、competitive differentiation and the ability to generate higher merchandise margins.Our scale has also allowed us to introduce our own proprietary western wear brands,Shyanne and Cody James,which offer high-quality western boots,shirts,jackets and hats for women and men,respectively.We also have an e
157、xclusive license agreement with country music star Brad Paisley,who designs a collection of boots,apparel and accessories for us,under the brand name Moonshine Spirit,that reflect his lifestyle and personality.In fiscal 2019 we entered into a new partnership with country music artist Miranda Lambert
158、,to develop a lifestyle brand,Idyllwind,inspired by her music and creative talents,which includes boots,apparel and accessories.In fiscal 2020 we developed two additional private brands,Hawx and Cody James Work.These brands offer high quality work wear and work boots to our customers.We created thes
159、e brands to address segments that we believe are underserved by third-party brands.We have a dedicated product development team that designs and sources merchandise from suppliers around the world.These product assortments are exclusive to Boot Barn and are merchandised and marketed as if they were
160、third-party brands both in our stores and on our e-commerce websites.In fiscal 2021,sales from our private brand products accounted for approximately 23.7%of our consolidated sales including our stores and e-commerce websites.These private brands differentiate us from our competitors and have histor
161、ically produced higher incremental merchandise margins than the third-party brands that we carry.Planning and allocation We believe that we have assembled a talented and experienced team in both the buying and merchandise planning functions.The experience of our team is critical to understanding the
162、 technical requirements of our merchandise based on region and use,such as the appropriate safety toe regulations for work boots in a particular industry.The team is constantly managing our replenishment model to ensure a high in-stock position by stock keeping unit,or SKU,on a store-by-store basis.
163、Our merchandising team optimizes the product selection,mix and depth across our stores by analyzing demand on a market-by-market basis,continuously reviewing our sell-through results,communicating with our suppliers about local market preferences and new products,shopping our competitors stores,and
164、immersing themselves in trade and western lifestyle events including rodeos,country music concerts and other industry-specific activities.Our merchandising team also makes frequent visits to our stores and partners with our regional,district and store managers to refine the merchandise assortment by
165、 region.Our team has demonstrated the ability to effectively manage merchandising,pricing and promotional strategies across our store base.To keep the product assortment fresh,we reposition a small portion of our merchandise on the sales floor every month.To drive traffic to our stores and create in
166、-store energy and excitement,we execute a promotional calendar that showcases select brands or merchandise categories throughout the year and rotates on a monthly cadence.Our promotional activity also enables us to consistently engage with our customers both online and in-store,as well as through ou
167、r various marketing media.Our ability to optimize the price for each merchandise category on a market-by-market basis,helps us to maximize profitability while remaining price competitive.Marketing and Advertising Our marketing strategy is designed to build brand awareness,acquire new customers,enhan
168、ce customer loyalty and drive in-store and online transactions.We customize our marketing mix for each of our markets and purposes.For example,during store grand openings we engage in additional local community outreach and advertise in local print media in select markets.We primarily use the follow
169、ing forms of media:Pay-per-clickWe use pay-per-click advertising to reach online shoppers whose behavior indicates an interest in our products.This marketing medium allows us the opportunity to grow our business and acquire new customers.Radio and televisionWe purchase spots on both national and reg
170、ional radio stations,primarily country music channels,to draw customers to nearby locations.We also maintain relationships with several country music artists in order to capitalize on the popularity of country music,using our stores and marketing communications to promote their album sales or concer
171、ts.In return,these country music artists often make in-store appearances or mention us on social 12 media and occasionally give private performances.We also purchase television spots to create awareness in new markets and occasionally help support grand openings of new stores.Direct mailWe conduct s
172、everal direct mail campaigns,and during fiscal 2021,we sent out approximately 3.3 million mailers,ranging in size from postcards to catalogs of approximately 50 pages.E-mailWe e-mail our e-commerce customers and members of our B Rewarded loyalty program as part of our cross-channel effort to drive t
173、raffic to our stores and websites.We sent more than one billion e-mails in fiscal 2021.Social mediaWe also have a marketing strategy that has produced a fast-growing social media presence,as evidenced by our strong following on Facebook and Instagram.Our posts celebrate country and western life and
174、humor,and routinely get thousands of likes,hundreds of shares and dozens of comments each.Event sponsorshipWe typically sponsor community-based western events each year within the regional footprint of our store locations.Houston Livestock Show and Rodeo,a well-known 20-day celebration of western he
175、ritage,is one of our most prominent sponsorships and attracts more than two million visitors to Houston,Texas,where we operate eighteen stores in the area.We also sponsor the San Antonio Stock Show and Rodeo,an 18-day event with more than two million attendees.Other prominent sponsorships include Ch
176、eyenne Frontier Days,the largest outdoor rodeo in the U.S.,the Professional Rodeo Cowboys Association and related National Finals Rodeo in Las Vegas,Nevada,Professional Bull Riders and the National High School Rodeo Association,which supports rodeos for competitors in high school and junior high sch
177、ool.At more prominent events,we often set up pop-up shops as large as 9,000 square feet,which allow participants to purchase our merchandise.As a result of the COVID-19 pandemic,public and private sector policies and initiatives intended to reduce the transmission of COVID-19,such as the imposition
178、of travel restrictions,mandates from federal,state and local authorities to avoid large gatherings of people,quarantine or“shelter-in-place”,and the promotion of social distancing significantly impacted events around the country.As a result of these initiatives,many large public events including rod
179、eos,concerts and country music festivals were cancelled or otherwise postponed.We believe additional event cancellations and postponements could negatively impact sales in the near-term.Distribution Our suppliers ship most of our in-store merchandise directly to our stores and a portion of our e-com
180、merce merchandise to our e-commerce customers.The remaining units are either shipped from our distribution center located in Fontana,California,or from the distribution center in Wichita,Kansas,that we acquired as a result of the Sheplers Acquisition.Our distribution center in California distributes
181、 our private brand and volume discount purchases to our stores,and supplies inventory for sponsored events and new store openings.Our Wichita,Kansas distribution center fulfills our e-commerce orders.In accordance with our automated replenishment programs,third-party suppliers typically deliver merc
182、handise to our stores daily,ensuring in-stock merchandise availability and a steady flow of new inventory for our customers.Competition The retail industry for western and work wear is highly fragmented and characterized by primarily regional competitors.We estimate that there are thousands of indep
183、endent specialty stores scattered across the country.We believe that we compete primarily with smaller regional chains and independents on the basis of product quality,brand recognition,price,customer service and the ability to identify and satisfy consumer demand.In addition,as we expand our e-comm
184、erce sales presence,we are competing to an increasing degree with online retailers and the e-commerce offerings of traditional competitors.We also compete with farm supply stores and,to a lesser degree,mass merchants,some of which are significantly larger than us,but most of which realize only a sma
185、ll percentage of their total revenues from the sale of western and work wear.We have more than three times as many stores as our nearest direct competitor that sells primarily western and work wear and we believe that our nationally recognized lifestyle brand,economies of scale,breadth and depth of
186、inventory across a variety of categories,strong in-stock position,portfolio of authentic private brands,enhanced supplier partnerships,exclusive offerings and ability to recruit and retain high quality store associates favorably differentiate us from our competitors.13 Information technology We have
187、 made significant investments to create a scalable information technology platform to support growth in our retail and e-commerce sales without further near-term investments in our information technology infrastructure.We use an Enterprise Resource Planning system(“Aptos Retail”)for integrated point
188、-of-sale,merchandising,planning,sales audit,customer relationship management,inventory control,loss prevention,purchase order management and business intelligence.We operate Aptos Retail on a software-as-a-service platform.This approach allows us to regularly upgrade to the most recent software rele
189、ase with minimal operational disruption,nominal systems infrastructure investment and a relatively small in-house information technology department.Aptos Retail also interfaces with our accounting system.We have also invested in an information technology platform for our e-commerce websites.At the e
190、nd of fiscal 2017,we upgraded our e-commerce platform.This upgrade of our e-commerce platform acts as the foundation for our digital store fronts.Intellectual property We regard our trademarks as having value and as being important to our marketing efforts.We have registered our trademarks in the U.
191、S.,including our brand name“Boot Barn”and our private label brands.We have a registered trademark for the“Sheplers”and“Country Outfitter”brand names.We have foreign trademark protection in China and Hong Kong where we have registered our Boot Barn trademarks.We also own the domain name for our prima
192、ry e-commerce websites, and .Our policy is to pursue registration of our trademarks and to rigorously defend their infringement by third parties.Our employees As of March 27,2021,we employed approximately 1,500 full-time and 3,400 part-time employees,of which approximately 600 were employed at our S
193、tore Support Center and distribution centers and approximately 4,300 were employed at our stores.The number of employees,especially part-time employees,fluctuates depending upon our seasonal needs.None of our employees are represented by a labor union and we consider our relationship with our employ
194、ees to be good.We have never experienced a strike or significant work stoppage.Regulation and legislation We are subject to labor and employment laws,laws governing truth-in-advertising,privacy laws,safety regulations and other laws at the federal,state and local level,including consumer protection
195、regulations,such as the Consumer Product Safety Improvement Act of 2008,that regulate retailers and govern the promotion and sale of merchandise and the operation of stores and warehouse facilities.We monitor changes in these laws and believe that we are in material compliance with all applicable la
196、ws.We source many of our private brand products from outside the U.S.The U.S.Foreign Corrupt Practices Act and other similar anti-bribery and anti-kickback laws and regulations generally prohibit companies and their intermediaries from making improper payments to non-U.S.officials for the purpose of
197、 obtaining or retaining business.Our policies and our supplier compliance agreements mandate compliance with applicable law,including these laws and regulations.Available Information Our internet address is and the investor relations section of our website is located at ,where we make available,free
198、 of charge,our annual reports on Form 10-K,quarterly reports on Form 10-Q and current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a)or 15(d)of the Securities Exchange Act of 1934,as well as proxy statements,as soon as reasonably practicable after we
199、electronically file such material with,or furnish it to,the Securities and Exchange Commission(the“SEC”).14 Information on our website should not be considered part of this Annual Report on Form 10-K unless specifically incorporated by reference herein.Cautionary Note Regarding Forward-Looking State
200、ments This annual report contains forward-looking statements that are subject to risks and uncertainties.All statements other than statements of historical or current fact included in this annual report are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933,as
201、 amended,and Section 21E of the Securities Exchange Act of 1934,as amended(the“Exchange Act”).Forward-looking statements refer to our current expectations and projections relating to,by way of example and without limitation,our financial condition,liquidity,profitability,results of operations,margin
202、s,plans,objectives,strategies,future performance,business and industry.You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts.These statements may include words such as“anticipate”,“estimate”,“expect”,“project”,“plan”,“intend”,“believe
203、”,“may”,“might”,“will”,“could”,“should”,“can have”,“likely”and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events,but not all forward-looking statements contain these identifying words.For ex
204、ample,all statements we make relating to our estimated and projected earnings,revenues,costs,expenditures,cash flows,growth rates and financial results,our plans and objectives for future operations,growth or initiatives,strategies or the expected outcome or impact of pending or threatened litigatio
205、n are forward-looking statements.Factors that might cause or contribute to such a discrepancy include,but are not limited to,the factors set forth in Item 1A.Risk Factors “Summary of Risk Factors”below.We derive many of our forward-looking statements from our current operating budgets and forecasts,
206、which are based upon detailed assumptions.While we believe that our assumptions are reasonable,we caution that it is very difficult to predict the impact of known factors,and it is impossible for us to anticipate all factors that could affect our actual results.For these reasons,we caution readers n
207、ot to place undue reliance on these forward-looking statements.See“Risk Factors”for a more complete discussion of the risks and uncertainties mentioned above and for a discussion of other risks and uncertainties.It is not possible for our management to predict all risks,nor can we assess the impact
208、of all factors on our business or the extent to which any factor,or combination of factors,may cause actual results to differ materially from those contained in any forward-looking statements we may make.In addition,the ongoing COVID-19 pandemic may also exacerbate other risks discussed herein,any o
209、f which could,individually or in the aggregate,have a material effect on us.Additional impacts from the COVID-19 pandemic may arise that we are not aware of currently.All forward-looking statements attributable to us are expressly qualified in their entirety by these cautionary statements as well as
210、 others made in this annual report and in our other SEC filings and public communications.You should evaluate all forward-looking statements made by us in the context of these risks and uncertainties.We caution you that the risks and uncertainties identified by us may not be all of the factors that
211、are important to you.Furthermore,the forward-looking statements included in this annual report are made only as of the date hereof.Our forward-looking statements do not reflect the potential impact of any future acquisitions,mergers,dispositions,joint ventures or investments that we may make.We unde
212、rtake no obligation to publicly update or revise any forward-looking statement as a result of new information,future events or otherwise,except as otherwise required by law.Item 1A.Risk Factors Summary of Risk Factors Below is a summary of the principal factors that make an investment in our common
213、stock speculative or risky.This summary does not address all of the risks that we face.Additional discussion of the risks summarized in this risk factor summary,and other risks that we face,can be found below under the heading“Risk Factors”and should be carefully considered,together with other infor
214、mation in this Form 10-K and our other filings with the SEC.15 Risks Related to our Business The ongoing COVID-19 pandemic may continue to adversely affect our business operations,growth strategies,store traffic,employee availability,financial condition,liquidity and cash flow for an extended period
215、 of time.Our sales could be severely impacted by decreases in consumer spending due to declines in consumer confidence,local economic conditions in our markets or changes in consumer preferences.Our business largely depends on a strong brand image,and if we are unable to maintain and enhance our bra
216、nd image,particularly in markets where we have newly acquired stores and in new markets where we have limited brand recognition,we may be unable to increase or maintain our level of sales.We face intense competition in our industry and we may be unable to compete effectively.Most of our merchandise
217、is produced in foreign countries,making the price and availability of our merchandise susceptible to international trade risks and other international conditions,including the impacts of COVID-19.Our failure to adapt to new challenges that arise when expanding into new geographic markets could adver
218、sely affect our ability to profitably operate those stores and maintain our brand image.Our continued growth depends upon successfully opening new stores as well as integrating any acquired stores,and our failure to successfully open new stores or integrate acquired stores could negatively affect ou
219、r business and stock price.As we expand our business,we may be unable to generate significant amounts of cash from operations.Any significant change in our distribution model could initially have an adverse impact on our cash flows and results of operations.If we fail to maintain good relationships
220、with our suppliers or if our suppliers are unable or unwilling to provide us with sufficient quantities of merchandise at acceptable prices,our business and operations may be adversely affected.Our efforts to improve and expand our exclusive product offerings may be unsuccessful,and implementing the
221、se efforts may divert our operational,managerial,financial and administrative resources,which could harm our competitive position and reduce our revenue and profitability.We purchase merchandise based on sales projections and our purchase of too much or too little inventory may adversely affect our
222、overall profitability.A rise in the cost of fabric,raw materials,labor or transportation could increase our cost of merchandise and cause our results of operations and margins to decline.If our suppliers and manufacturers fail to use acceptable labor or other practices,our reputation may be harmed,w
223、hich could negatively impact our business.If we lose key management personnel,our operations could be negatively impacted.If we cannot attract,train and retain qualified employees,our business could be adversely affected.Higher wage and benefit costs could adversely affect our business.The concentra
224、tion of our stores and operations in certain geographic locations subjects us to regional economic conditions and natural disasters that could adversely affect our business.We could be required to collect additional sales taxes or be subject to other tax liabilities that may increase the costs our c
225、lients would have to pay for our products and adversely affect our operating results.The adoption of new tax legislation could affect our financial performance.Our leverage may reduce our cash flow available to grow our business.Our borrowings under the June 2015 Wells Fargo Revolver and the 2015 Go
226、lub Term Loan are at variable rates,exposing us to interest rate risk,including increases in interest rates resulting from changes in the determination of the London Interbank Offered Rate.The June 2015 Wells Fargo Revolver and the 2015 Golub Term Loan contain restrictions and limitations that could
227、 significantly impact our ability to operate our business.We are required to make significant lease payments for our stores,Store Support Center and distribution center,which may strain our cash flow.New accounting guidance or changes in the interpretation or application of existing accounting guida
228、nce could adversely affect our financial performance.16 We may be unable to maintain same store sales or net sales per square foot,which may cause our results of operations to decline.Any inability to balance our private brand merchandise with the third-party branded merchandise that we sell may hav
229、e an adverse effect on our net sales and gross profit.We are subject to payment-related risks that could increase our operating costs,expose us to fraud or theft,subject us to potential liability and potentially disrupt our business.If our management information systems fail to operate or are unable
230、 to support our growth,our operations could be disrupted.We rely on UPS and the United States Postal Service to deliver our e-commerce merchandise to our customers and our business could be negatively impacted by disruptions in the operations of these third-party service providers.Use of social medi
231、a may adversely impact our reputation or subject us to fines or other penalties.Our e-commerce businesses subject us to numerous risks that could have an adverse effect on our results of operations.Our sales can significantly fluctuate based upon shopping seasons,which may cause our results of opera
232、tions to fluctuate disproportionately on a quarterly basis.We buy and stock merchandise based upon seasonal weather patterns and therefore unseasonable or extreme weather could negatively impact our sales,financial condition and results of operations.If we fail to obtain and retain high-visibility s
233、ponsorship or endorsement arrangements with celebrities,or if the reputation of any of the celebrities that we partner with is impaired,our business may suffer.Our management information systems and databases could be disrupted by system security failures,cyber threats or by the failure of,or lack o
234、f access to,our Enterprise Resource Planning system.These disruptions could negatively impact our sales,increase our expenses,subject us to liability and/or harm our reputation.Our failure to maintain adequate internal controls over our financial and management systems may cause errors in our financ
235、ial reporting.These errors may cause a loss of investor confidence and result in a decline in the price of our common stock.If we are unable to protect our intellectual property rights,our financial results may be negatively impacted.We may be subject to liability if we,or our suppliers,infringe upo
236、n the intellectual property rights of third parties.Litigation costs and the outcome of litigation could have a material adverse effect on our business.Issues with merchandise safety could damage our reputation,sales and financial results.Union attempts to organize our employees could negatively aff
237、ect our business.Violations of or changes in laws,including employment laws and laws related to our merchandise,could make conducting our business more expensive or change the way we do business.We may engage in strategic transactions that could negatively impact our liquidity,increase our expenses
238、and present significant distractions to our management.Terrorism or civil unrest could negatively affect our business.If our goodwill,intangible assets or long-lived assets become impaired,we may be required to record a significant charge to earnings.Risks Related To Ownership of Our Common Stock Th
239、e market price and trading volume of our common stock have been and may continue to be volatile,which could result in rapid and substantial losses for our stockholders,and you may lose all or part of your investment.Anti-takeover provisions in our corporate organizational documents and current credi
240、t facility and under Delaware law may delay,deter or prevent a takeover of us and the replacement or removal of our management,even if such a change of control would benefit our stockholders.If securities or industry analysts do not publish research and reports or publish inaccurate or unfavorable r
241、esearch and reports about our business,the price and trading volume of our common stock could decline.We do not currently intend to pay cash dividends on our common stock,which may make our common stock less desirable to investors and decrease its value.17 Risk Factors You should carefully consider
242、the risks and uncertainties described below,together with all of the other information in this annual report,including our consolidated financial statements,and related notes included elsewhere in this annual report.If any of the following risks were realized,our business,financial condition,results
243、 of operations and prospects could be materially and adversely affected.In that event,the price of our common stock could decline,and you could lose part or all of your investment.Risks Related To Our Business The ongoing COVID-19 pandemic may continue to adversely affect our business operations,gro
244、wth strategies,store traffic,employee availability,financial condition,liquidity and cash flow for an extended period of time.The ongoing COVID-19 pandemic,has adversely affected our business and may continue to adversely affect our business for an indefinite period until the impact of the pandemic
245、subsides.Since first being reported,COVID-19 has spread to numerous countries around the world,including the U.S.Measures taken by governmental authorities to reduce the transmission of COVID-19,including stay-at-home orders and business closures,as well as lack of subsequent economic stimulus initi
246、atives,have resulted in wide-scale unemployment and financial hardship for a large portion of the U.S.population,and these impacts,among others,have created significant uncertainties.These uncertainties include,but are not limited to,the potential adverse effect of the pandemic on the economy,our su
247、pply chain partners,our employees and customers,customer sentiment in general,and traffic within our stores and on our e-commerce sites.As a result of the economic slowdown caused by COVID-19,many industries and public and private sector jobs have been and may continue to be impacted,including but n
248、ot limited to those in the construction,domestic manufacturing,energy,food and agriculture,transportation and warehouse sectors.Consumer fear about becoming ill with the virus and recommendations and/or mandates from federal,state and local authorities to avoid large gatherings of people or self-qua
249、rantine may continue or may increase,which has already affected,and may continue to affect,traffic to our stores.If as a result of the pandemic,we are unable to continue to provide employees with appropriate compensation and protective measures,we may be unable to retain or attract employees to perf
250、orm necessary functions within our stores and engage with our customers.In addition,if we are required to transition certain or all our employees to a remote work environment in an effort to mitigate the spread of COVID-19,our failure to provide appropriate technological resources and maintain adequ
251、ate safeguards around our remote work environment could result in loss of productivity and usage errors by our employees or the loss or compromise of confidential customer,employee or company data.In addition,the remote work environment may increase certain risks to our business,including phishing a
252、nd other cybersecurity attacks.Although our operations have generally stabilized since the onset of the pandemic,there can be no assurances that the spread of COVID-19 will not strain our supply chain,store operations and merchandising functions in the future.This could create difficulties and delay
253、s in obtaining products from our distributors,delivering products to our stores and adequately staffing our stores and distribution centers.If we are unable to continue to source,transport and stock products in our stores or to maintain adequate staffing levels in our stores and distribution centers
254、 due to disruptions caused by the COVID-19 pandemic,we will be unable to maintain inventory levels and continue to operate our stores at levels to meet customer demand.Further,if we do not identify and source appropriate products in response to our customers evolving needs during the COVID-19 pandem
255、ic,we may lose existing customers and fail to attract new customers,which could cause our sales to decrease,resulting in a material adverse effect on our business,financial condition,results of operations and cash flows.18 Except for temporary store closures due to COVID-19,all of our stores remaine
256、d open as of March 27,2021.We have experienced instances of our employees contracting COVID-19,and in response we follow CDC and other health authority guidelines to report positive test results and reduce further transmission.Although our stores currently remain open,any widespread transmission of
257、COVID-19 among our employees within a particular store or geographical area might necessitate that we temporarily close certain stores,which may negatively affect our business and financial condition,as well as the perception of our company.Additionally,any widespread transmission of COVID-19 among
258、the employees in our distribution centers might necessitate the temporary closure of our facilities,resulting in product delivery delays and other logistical constraints.Further,if individuals believe they have contracted COVID-19 in our stores or believe that we have not taken appropriate precautio
259、nary measures to reduce the transmission of COVID-19,we may be subject to costly and time-consuming litigation.Continued impacts of the pandemic could have a material adverse effect on our near-term and long-term business operations,store traffic,employee availability,financial condition,liquidity a
260、nd cash flow,and may require significant actions in response,including but not limited to,additional employee furloughs and/or layoffs,reduced store hours or additional store closings,expense reductions,discounting of pricing of our products,all in an effort to mitigate the impacts of the pandemic.T
261、he full extent to which the COVID-19 pandemic impacts our business and financial condition will largely depend on future developments,which are highly uncertain and cannot be predicted,including new information which may emerge concerning the severity of the pandemic,the impacts of new variants of t
262、he virus,the timing,distribution,efficacy and public acceptance of vaccines and other treatments for COVID-19 and the actions necessary to contain COVID-19.Our sales could be severely impacted by decreases in consumer spending due to declines in consumer confidence,local economic conditions in our m
263、arkets or changes in consumer preferences.We depend upon consumers feeling confident about spending discretionary income on our products to drive our sales.Consumer spending may be adversely impacted by economic conditions,such as consumer confidence in future economic conditions,interest and tax ra
264、tes,inflation,employment levels,salary and wage levels,the availability of consumer credit,the level of housing,energy and food costs,general business conditions and other challenges affecting the global economy including the ongoing COVID-19 pandemic.These risks may be exacerbated for retailers lik
265、e us who focus on specialty footwear,apparel and accessories.Our financial performance is particularly susceptible to economic and other conditions in California,Texas and other states where we have a significant number of stores.Many of our stores operate in geographic areas where the local economi
266、es depend to a significant degree on oil and other commodity extraction,and many of our customers are employed in these industries.As a result of the economic slowdown caused by COVID-19,the global demand for oil was significantly impacted and the price of oil was driven down significantly from prev
267、ious levels.Our financial performance is accordingly susceptible to economic and other conditions relating to output and employment in these areas.Our financial performance also is impacted by conditions in the construction sector,domestic manufacturing and the transportation and warehouse sectors,t
268、he growth of which we believe is an important driver of our work wear business.In addition,our financial performance may be negatively affected if the popularity of the western and country lifestyle subsides,or if there is a general trend in consumer preferences away from boots and other western or
269、country products in favor of another general category of footwear or attire.If this were to occur or if periods of decreased consumer spending persist,our sales could decrease,which could have a material adverse effect on our business,financial condition,results of operations and prospects.In additi
270、on,difficult economic conditions may exacerbate some of the other risks described in this Item 1A.Risk Factors,including those risks associated with increased competition,decreases in store traffic,brand reputation,the interruption of the production and flow of merchandise,the ability to achieve our
271、 growth strategies,and the ability to improve and expand our exclusive product offering.These risks could be exacerbated individually or collectively.Our business largely depends on a strong brand image,and if we are unable to maintain and enhance our brand image,particularly in markets where we hav
272、e newly acquired stores and in new markets where we have limited brand recognition,we may be unable to increase or maintain our level of sales.We believe that our brand image and brand awareness have contributed significantly to the success of our business.We also believe that maintaining and enhanc
273、ing our brand image,particularly in markets where we have newly acquired stores and in new markets where we have limited brand recognition,is important to maintaining and expanding 19 our customer base.Our ability to successfully integrate newly acquired and newly opened stores into their surroundin
274、g communities,to expand into new markets or to maintain the strength and distinctiveness of our brand image in our existing markets will be adversely impacted if we fail to connect with our target customers.Our efforts to rebrand newly acquired stores could result in reduced sales and profitability
275、of such stores.Maintaining and enhancing our brand image may require us to make substantial investments in areas such as merchandising,marketing,store operations,community relations,store graphics and employee training,which could adversely affect our cash flow and which may ultimately be unsuccessf
276、ul.Furthermore,our brand image could be jeopardized if we fail to maintain high standards for merchandise quality,if we fail to comply with local laws and regulations or if we experience negative publicity or other negative events that affect our image and reputation.Some of these risks may be beyon
277、d our ability to control,such as the effects of negative publicity regarding our suppliers.Failure to successfully market and maintain our brand image in new and existing markets could harm our business,results of operations and financial condition.We face intense competition in our industry and we
278、may be unable to compete effectively.The retail industry for western and work wear is highly fragmented and characterized by primarily regional competitors.We estimate that there are thousands of independent specialty stores scattered across the country.We believe that we compete primarily with smal
279、ler regional chains and independent stores on the basis of product quality,brand recognition,price,customer service and the ability to identify and satisfy consumer demand.In addition,as we expand our e-commerce sales presence and as a result of consumers growing desire to shop online(including as a
280、 result of the COVID-19 pandemic),we are competing to an increasing degree with online retailers and the e-commerce offerings of traditional competitors.There can be no assurance that our e-commerce expansion initiatives will be successful.We also compete with farm supply stores and,to a lesser degr
281、ee,mass merchants.Competition with some or all of these retailers could require us to lower our prices or risk losing customers.In addition,significant or unusual promotional activities by our competitors may force us to respond in-kind and adversely impact our operating cash flow and gross profit.A
282、s a result of these factors,current and future competition could have a material adverse effect on our financial condition and results of operations.Many of the mass merchants and online retailers that sell some western or work wear products have greater financial,marketing and other resources than
283、we currently do,and in the case of online retailers,lower overhead and overall cost structure.Therefore,these competitors may be able to devote greater resources to the marketing and sale of these products,generate national brand recognition or adopt more aggressive pricing policies than we can,whic
284、h would put us at a competitive disadvantage if they decide to expand their offerings of these product lines.Moreover,we do not possess exclusive rights to many of the elements that comprise our in-store experience and product offerings.Our competitors may seek to emulate facets of our business stra
285、tegy,including our in-store experience,which could result in a reduction of some competitive advantages or special appeal that we might possess.In addition,most of our suppliers sell products to us on a non-exclusive basis.As a result,our current and future competitors may be able to duplicate or im
286、prove on some or all of the in-store and e-commerce product offerings that we believe are important in differentiating our stores,our e-commerce offerings and our customers shopping experience.If our competitors were to duplicate or improve on some or all of our in-store experience,or our in-store a
287、nd e-commerce product offerings,our competitive position and our business could suffer.Most of our merchandise is produced in foreign countries,making the price and availability of our merchandise susceptible to international trade risks and other international conditions,including the impacts of CO
288、VID-19.The majority of our private brand products are manufactured in foreign countries,including Mexico and China.In addition,we purchase most of our third-party branded merchandise from domestic suppliers that have a large portion of their merchandise made in foreign countries.The countries,specif
289、ically Mexico and China,in which our merchandise currently is manufactured or may be manufactured in the future could become subject to trade restrictions imposed by the U.S.,including increased tariffs or quotas,embargoes and customs restrictions,which could increase the cost or reduce the supply o
290、f products available to us and have a material adverse effect on our business,financial condition and results of operations.Recently,uncertainty has increased regarding tax and trade policies,border adjustments,tariffs and government regulations affecting trade between the U.S.and other countries,su
291、ch as Mexico and China.Such tariffs on imports from foreign countries,as well 20 as changes in tax and trade policies such as a border adjustment tax or disallowance of certain tax deductions for imported merchandise,if enacted,could materially increase our manufacturing costs,the costs of our impor
292、ted merchandise or our income tax expense,which would have a material adverse effect on our financial condition and results of operations.Any tariffs by China or other foreign countries on imports of our products could also adversely affect our international e-commerce sales.Any increase in our manu
293、facturing costs,the cost of our merchandise or limitation on the amount of merchandise we are able to purchase,or any decrease in our international e-commerce sales,could have a material adverse effect on our financial condition and results of operations.Additionally,public health issues affecting C
294、hina,Mexico or another foreign country from which a large portion of our third-party and private brand merchandise is purchased and imported,including the ongoing COVID-19 pandemic,may result in the temporary closure of our suppliers facilities or shipping ports,resulting in product delivery delays.
295、For example,COVID-19 has led to work and travel restrictions in and out of China and other countries around the world as well as temporary closures or production and logistical constraints due to workforce availability of certain factories in China.These travel restrictions,factory closures and prod
296、uction and logistical constraints may result in,among other things,delayed shipments and increased shipping costs.These impacts on our supply chain could have a material adverse effect on our financial condition and results of operations.Our failure to adapt to new challenges that arise when expandi
297、ng into new geographic markets could adversely affect our ability to profitably operate those stores and maintain our brand image.Our expansion into new geographic markets could result in competitive,merchandising,distribution and other challenges that are different from those we encounter in the ge
298、ographic markets in which we currently operate.In addition,to the extent that our store count increases,we may face risks associated with market saturation of our product offerings and locations.Our suppliers may also restrict their sales to us in new markets to the extent they are already saturatin
299、g that market with their products through other retailers or their own stores.There can be no assurance that any newly opened stores will be received as well as,or achieve net sales or profitability levels comparable to those of,our existing stores in the time periods estimated by us,or at all.If ou
300、r stores fail to achieve,or are unable to sustain,acceptable net sales and profitability levels,our business may be materially harmed,we may incur significant costs associated with closing those stores and our brand image may be negatively impacted.Our continued growth depends upon successfully open
301、ing new stores as well as integrating any acquired stores,and our failure to successfully open new stores or integrate acquired stores could negatively affect our business and stock price.We have grown our store count rapidly in recent years,both organically and through strategic acquisitions of com
302、peting chains.Our ability to successfully open and operate new and acquired stores is subject to a variety of risks and uncertainties,such as:identifying suitable store locations,the availability of which is beyond our control;obtaining acceptable lease terms;sourcing sufficient levels of inventory;
303、selecting the appropriate merchandise to appeal to our customers;hiring,training and retaining store employees;assimilating new store employees into our corporate culture;marketing the new stores locations and product offerings effectively;avoiding construction delays and cost overruns in connection
304、 with the build out of new stores;21 avoiding other costs in opening new stores,such as rebranding acquired locations and environmental liabilities;managing and expanding our infrastructure to accommodate growth;and integrating the new and acquired stores with our existing buying,distribution and ot
305、her support operations.Our failure to successfully address these challenges could have a material adverse effect on our financial condition and results of operations.We opened or acquired 15 stores in fiscal 2021,20 stores in fiscal 2020,and 17 stores in fiscal 2019.We plan to continue to open or ac
306、quire new stores in the coming years;however,there can be no assurance that we will open or acquire new stores in fiscal 2022 or thereafter,or that any such stores will be profitable.The expansion of our store base will place increased demands on our operational,managerial and administrative resourc
307、es.These increased demands could cause us to operate our existing business less effectively,which in turn could cause the financial performance of our existing stores to deteriorate.In addition,we plan to open some new stores within existing markets.Some of these new stores may open close enough to
308、our existing stores that a segment of customers will stop shopping at our existing stores and instead shop at the new stores,causing sales and profitability at those existing stores to decline.If this were to occur with a number of our stores,this could have a material adverse effect on our financia
309、l condition and results of operations.In addition to opening new stores,we may acquire and rebrand stores.Acquiring and integrating stores involves additional risks that could adversely affect our growth and results of operations.Newly acquired stores may be unprofitable and we may incur significant
310、 costs and expenses in connection with any acquisition including systems integration and costs relating to remerchandising and rebranding the acquired stores.Integrating newly acquired chains or individual stores may divert our senior managements attention from our core business.Our ability to integ
311、rate newly acquired stores will depend on the successful expansion of our existing financial controls,distribution model,information systems,management and human resources and on attracting,training and retaining qualified employees.As we expand our business,we may be unable to generate significant
312、amounts of cash from operations.As we expand our business,we will need significant amounts of cash from operations to pay our existing and future lease obligations,build out new store space,purchase inventory,pay personnel,and,if necessary,further invest in our infrastructure and facilities.We prima
313、rily rely on cash flow generated from existing stores and our e-commerce businesses to fund our current operations and our growth.It typically takes several months and a significant amount of cash to open a new store.For example,our new store model requires an average net cash investment of approxim
314、ately$0.8 million.If we continue to open a large number of stores relatively close in time,the cost of these store openings and the cost of continuing operations could reduce our cash position.An increase in our net cash outflow for new stores could adversely affect our operations by reducing the am
315、ount of cash available to address other aspects of our business.We cannot assure you that any new stores that we open will become profitable in the anticipated time frame,or at all.Not all of our stores are currently profitable.We cannot assure you that our existing stores,which may be currently pro
316、fitable,will not cease to be profitable in the future.If our business does not generate sufficient cash flow from operations to fund these activities,and sufficient funds are not otherwise available from our current credit facility or future credit facilities,we may need additional equity or debt fi
317、nancing.If such financing is not available to us on satisfactory terms,our ability to operate and expand our business or to respond to competitive pressures would be limited and we could be required to delay,curtail or eliminate planned store openings.Moreover,if we raise additional capital by issui
318、ng equity securities or securities convertible into equity securities,your ownership may be diluted.Any debt financing we may incur may impose covenants that restrict our operations,and will require interest payments that would create additional cash demands and financial risk for us.22 Any signific
319、ant change in our distribution model could initially have an adverse impact on our cash flows and results of operations.Our suppliers ship most of our in-store merchandise directly to our stores and a portion of our e-commerce merchandise to our e-commerce customers.In the future,as part of our long
320、-term strategic planning,we may change our distribution model to increase the amount of merchandise that we self-distribute through a centralized distribution center.Changing our distribution model to increase distributions from a centralized distribution center to our stores and customers would ini
321、tially involve significant capital expenditures,which would increase our borrowings and interest expense or temporarily reduce the rate at which we open new stores.In addition,if we are unable to successfully integrate a new distribution model into our operations in a timely manner,our supply chain
322、could experience significant disruptions,which could reduce our sales and adversely impact our results of operations.If we fail to maintain good relationships with our suppliers or if our suppliers are unable or unwilling to provide us with sufficient quantities of merchandise at acceptable prices,o
323、ur business and operations may be adversely affected.Our business is largely dependent on continued good relationships with our suppliers,including suppliers for our third-party branded products and manufacturers for our private brand products.During fiscal 2021,merchandise purchased from our top th
324、ree suppliers accounted for approximately 21%,6%and 6%of our sales,respectively.We operate on a purchase order basis for our private brand and third-party branded merchandise and do not have long-term written agreements with our suppliers.Accordingly,our suppliers can refuse to sell us merchandise,l
325、imit the type or quantity of merchandise that they sell to us,enter into exclusivity arrangements with our competitors or raise prices at any time,which could have an adverse impact on our business.Deterioration in our relationships with our suppliers could have a material adverse impact on our busi
326、ness,and there can be no assurance that we will be able to acquire desired merchandise in sufficient quantities on terms acceptable to us in the future.Also,some of our suppliers sell products directly from their own retail stores or e-commerce websites,and therefore directly compete with us.These s
327、uppliers may decide at some point in the future to discontinue supplying their merchandise to us,supply us less desirable merchandise or raise prices on the products they do sell us.If we lose key suppliers and are unable to find alternative suppliers to provide us with substitute merchandise for lo
328、st products,our business may be adversely affected.Our efforts to improve and expand our exclusive product offerings may be unsuccessful,and implementing these efforts may divert our operational,managerial,financial and administrative resources,which could harm our competitive position and reduce ou
329、r revenue and profitability.We seek to grow our business by improving and expanding our exclusive product offerings,which includes introducing new brands and growing and expanding our existing brands.The principal risks to our ability to successfully improve and expand our product offering are that:
330、introduction of new products may be delayed,which may allow our competitors to introduce similar products in a more timely fashion,which could hinder our ability to be viewed as the exclusive provider of certain western and work apparel brands and items;the third-party suppliers of our exclusive pro
331、duct offerings may not maintain adequate controls with respect to product specifications and quality,which may lead to costly corrective action and damage to our brand image;if our expanded exclusive product offerings fail to maintain and enhance our distinctive brand identity,our brand image may be
332、 diminished and our sales may decrease;and these efforts may divert our managements attention from other aspects of our business and place a strain on our operational,managerial,financial and administrative resources,as well as our information systems.In addition,our ability to successfully improve
333、and expand our exclusive product offerings may be affected by economic and competitive conditions,changes in consumer spending patterns and changes in consumer preferences,including those resulting from the COVID-19 pandemic.These efforts could be abandoned,cost more than anticipated 23 and divert resources from other areas of our business,any of which could impact our competitive position and re
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