2 0 0 2 ANNUAL REPORT
Leadership... TheVoice of RetailWorldwide
In Uncertain Times
NRF
The Voice of Retail
CHAIRMAN’S MESSAGE
R
etailing has come a very long way since the first merchants sold their wares from pushcarts. Today we shop around the world for the perfect goods to satisfy our customers’ ever-changing tastes, we rely on increasingly sophisticated technology to run our businesses and anticipate new trends, and we have training programs to
ensure our sales staff provide consumers with a satisfying customer experience. Yet the pace of competition continues to increase. Today, the typical customer has more options than ever before. Stores proliferate and access to the Internet and its myriad shopping venues is growing rapidly. Despite this competition, there are many areas where retailers benefit from working together, sharing information and best practices and joining forces to influence pressing public policy issues. Through NRF, the industry gains a collective voice that is exponentially more influential and effective than could be achieved autonomously or in smaller coalitions. Many of the activities under the NRF umbrella, such as providing critical research, advocating industry messages to elected officials and the media, and developing industry conferences, are vital to our industry and would not be possible without NRF. I encourage you to read more about NRF and these activities in the following pages. And I thank the businesses and individuals that are contributing to the organization’s success.
Gordon I. Segal Chairman of the Board and Chairman of the Executive Committee CEO, Crate & Barrel
Worldwide
i
PRESIDENT’S LETTER
T
hroughout 2002, as a nation we recognized and acknowledged the importance of leadership. We embraced national leadership to help us put thoughts of terrorism behind us and shift our thinking toward a more optimistic future. We agonized over the failure of corporate leadership that became so obvious in the wake of the Enron and WorldCom
scandals. We experienced church leadership fall from grace. And we watched the incredible speed with which congressional leadership could be turned on its head. The retail industry exerted its own brand of leadership as it continued to do what it always does so well, meeting economic challenges head on and reaching out to communities and consumers in times of need. In 2002, many economists credited consumer spending and retail sales as the Atlas holding aloft the U.S. economy. So, retailers’ ability to attract customers and generate sales served as a major source for optimism. Retailers knew the year would not be an easy one, but the industry continued to look forward, constantly striving to identify unique products to meet consumers’ increasingly fickle tastes, implement new merchandising strategies, and adopt technology enhancements now that will shape the future of the shopping experience. NRF continued to assert its leadership as a source for retail information, education and training and as an innovator by assisting retailers’ multi-channel initiatives and driving IT systems standardization. NRF also continued its proud tradition of serving as the retail industry’s foremost advocate. Our ability as an organization to quickly and substantively address retail industry issues is crucial to our mission and proved essential throughout 2002. Our programs were both timely and informative, and we created several important new benefits that will make the Federation even more valuable to members in 2003 and the years ahead. As we move forward and the marketplace becomes more favorable for retailers, we will continue to call on our members to participate actively in our programs and contribute to setting the organization’s agenda. Working collectively through NRF, we can influence the direction of our industry and the policies that affect us. And, that’s what leadership is all about.
Tracy Mullin President and CEO National Retail Federation ii
THE YEAR IN REVIEW
2002
Highlights
NRF was the industry’s most vocal advocate in the nation’s capitol, securing Bush Administration action to re-open the West Coast docks in time for the vital holiday season, and winning numerous battles in Congress and Federal agencies. (Page 4)
NRF Foundation continues its efforts to add skilled workers to the pool of potential retail employees, by providing training and education as well as encouraging careers in retail. (Page 30)
Retail’s Big Show remains the premier retail industry gathering, and in 2003 it will get even bigger. (Page 10)
iii
2002
David Petiford, General Manager, IBM Global Retail Industry
â–ź
Highlights
New conferences on Customer Relationship Management, technology and merchandising are increasing NRF’s educational offerings and furthering its role as the leading source for industry programming. (Page 13)
iv
Retail Horizons In partnership with KPMG Consulting, NRF produced a remarkable annual study, Retail Horizons, which will be the definitive source of benchmarking information and in-depth analysis for retailers. (Page 17)
NRF positioned itself as a vital source for online retailers and a leading conduit for retail technology standardization, through its Shop.org and ARTS divisions, respectively. (Page 26)
Contents Chairman’s Message..................................................................................i President’s Letter......................................................................................ii The Year in Review ..............................................................................iii-iv Officers and Board of Directors............................................................2-3 CHAPTER
1 2 3 4 5 6 7 8 9
Government Relations
4
Public Relations
8
Conferences
10
Member Services
17
Advisory Committees
22
NRF Divisions
26
NRF Foundation
30
STORES Magazine
32
Financial Information Statement of Purpose
Inside back cover
Back cover
N RF OFFICERS
CHAIRMAN OF THE BOARD AND CHAIRMAN OF THE EXECUTIVE COMMITTEE
*Gordon I. Segal Chief Executive Officer Crate & Barrel
FIRST VICE CHAIRMAN OF THE BOARD AND CHAIRMAN OF THE FINANCE COMMITTEE
*James M. Zimmerman Chairman and CEO Federated Department Stores, Inc.
SECOND VICE CHAIRMAN OF THE BOARD
*Arnold B. Zetcher Chairman, President and CEO The Talbots Inc.
BOARD OF DIRECTORS Howard S. Abrams
Andre L.S. de Botton
President and CEO deJong’s, Inc.
President and CEO Balliet’s LLC.
President ACV Comercio e Participações
Michael Anthony
Henry Berlin
Brian Devine
Chairman, President, and CEO Brookstone, Inc.
CEO Berlin’s Brothers, Inc.
Chairman, President and CEO PETCO Animal Supplies, Inc.
Donald Balfour
Cem Boyner
Vice President Waffle House Inc.
Vice Chairman and CEO Boyner Holding A.S.
Thomas J. Bata
Mark Bozek
Honorary Chairman Bata Limited
CEO HSN
*Robert M. Beall, II Chairman and CEO Bealls, Inc.
John M. Belk Chairman and CEO Belk, Inc.
Adrian Bellamy Chairman The Body Shop, Inc.
Raphael Benaroya Chairman, President and CEO United Retail Group, Inc. 2
*Robert M. Benham
*Craig L. Fuller President and CEO National Association of Chain Drug Stores
*Marvin J. Girouard Chairman, President and CEO Pier 1 Imports Inc.
John L. Dunham
Robert A. Glick
President The May Department Stores Company
Chairman and CEO Dots, Inc.
John Eyler
John M. Hancock
Chairman, President and CEO Toys “R” Us, Inc.
Chief Executive MFI Furniture Group PLC
Paul R. Charron Chairman and CEO Liz Claiborne Inc.
*Donald G. Fisher
Lisa M. Harper
Chairman GAP, Inc.
VC and CEO The Gymboree Corporation
Joseph A. Flannery
George Heller
President Weaver’s, Inc.
President and CEO Hudson’s Bay Company
*Evan Cole President and CEO ABC Carpet & Home
*A. F. Dawahare President Dawahare’s, Inc.
*Louis Fortunoff EVP, Customer Service Fortunoff Fine Jewelry & Silverware, Inc.
Philippe Houzé Co-CEO Galeries Lafayette Group
Elliot S. Jaffe Chairman The Dress Barn, Inc.
THIRD VICE CHAIRMAN OF THE BOARD
*J. Hill Stockton President Norman Stockton, Inc.
CHAIRMAN OF THE AWARDS & NOMINATIONS COMMITTEE
*Arnold B. Zetcher
Lovro Mandac
Chairman and CEO dELiA*s Corp.
Chairman Kaufhof Warenhaus AG
*R. Brad Martin Chairman and CEO Saks Incorporated
James L. Kittle Jr.
H. Michael May
Chairman Kittle’s Home Furnishings
President May Brothers Clothing Company
Chairman Shui Hing (HK) Limited
Kazumasa Koshiba President Isetan Company Limited
*Alan J. Lacy Chairman, President and CEO Sears, Roebuck and Co.
*H. James Baum
President and CEO National Retail Federation
Chairman, President and CEO Ethan Allen Inc.
*Daniel S.C. Koo
CORPORATE SECRETARY
*Tracy Mullin
Chairman, President and CEO The Talbots Inc.
Stephen I. Kahn
*M. Farooq Kathwari
PRESIDENT AND CEO
James F. McCann Chairman and CEO 1-800-FLOWERS.COM
*Michael F. Moorman Chairman and CEO Peebles Inc.
President Baum’s Inc.
*Bruce Nelson Chairman and CEO Office Depot, Inc.
Chairman and CEO J.C. Penney Company, Inc.
President and CEO The Athlete’s Foot Group, Inc.
Robert A. Smith Co-Vice Chairman The Neiman Marcus Group, Inc.
*Robert J. Ulrich Chairman and CEO Target Corporation
*Leonard H. Roberts Chairman and CEO RadioShack Corporation
*A. Daryl Routzahn
Dr. Barton A. Weitz Executive Director Center for Retail Education University of Florida
President and CEO Routzahn’s
Leslie H. Wexner
Walter J. Salmon
Chairman and CEO Limited Brands
Emeritus Professor of Retailing Harvard Business School
*Jerry Wheeler
Tom Moser
Rowland Schaefer
Executive Director South Dakota Retailers Association
Vice Chairman KPMG
Chairman, President and CEO Claire’s Stores, Inc.
Martin Zaepfel Vice Chairman, President and CEO The Spiegel Group
Edwin T. Mosher
Kenneth E. Seiff
President and CEO Retek Inc.
President Mosher’s Ltd.
Chairman, President, CEO and Treasurer Bluefly.com
Chairman Gottschalks Inc.
*Robert J. Corliss
Allen Questrom
Steven D. Ladwig
Joseph W. Levy
CHAIRMAN OF THE NRF FOUNDATION
*Shelley Nandkeolyar EVP and President, Internet and Direct Commerce Martha Stewart Living
*denotes members of the Executive Committee
3
1 Government Relations Retail industry leaders chat with Speaker of the House Dennis Hastert (R-IL).
NRF Protects Retail Interests in the Public Policy Arena
LEGISLATIVE/REGULATORY ACTIVITY " When labor unrest shut down West Coast ports and threatened to cut off the supply of billions of dollars worth of merchandise to retailers during the crucial holiday sales season, NRF’s Government Relations Department went straight to the top. A letter to President Bush and meetings with top White House staff and congressional leaders underscored the devastating impact a protracted work stoppage would have on retailers. Due in part to political pressure exercised by retailers, a new labor contract was finalized. " Following the tragedies of September 11, 2001, affordable insurance coverage for terrorist attacks on stores, shopping malls and other commercial real estate began to rapidly dry up. NRF successfully fought for legislation that will create a federal backstop program making coverage once again available at affordable prices. " Several of retail’s biggest trade objectives were realized at once when President Bush signed the Trade Act of 2002 into law. The cornerstone was Trade Promotion Authority, which will make it easier for the United States 4
▼
NRF is consistently rated as one of the most influential and effective trade associations in Washington, offering policy expertise and representation on all legislative, regulatory and political affairs at the federal level. In 2002, NRF lobbied Congress and federal agencies on dozens of issues directly affecting the retail industry. NRF representation — both proactive and defensive — brought the industry billions of dollars in economic benefits.
▼
Paul Charron, Chairman and CEO of Liz Claiborne (right), chats with influential Senate leader John McCain (R-AZ).
to participate in trade agreements that reduce tariffs on consumer goods and let retailers do more business abroad. The new law also saves retailers $700 million a year by reinstating the Generalized System of Preferences for a period of five years, and increases the amount of clothing that can be imported duty-free from the Caribbean Basin, Africa and Andean countries. " For the third congressional session in a row, bankruptcy reform legislation that would save the business community $4 billion a year was passed overwhelmingly by the House and Senate with NRF’s support, only to go down to defeat at the last minute. NRF is assessing whether the industry wants to pursue this Sisyphean task again when the 108th Congress convenes in January. " A federal judge certified NRF’s class-action lawsuit against Visa and MasterCard over attempts to force retailers to accept signature-based debit cards that carry much higher transaction fees than PIN-protected cards. The case goes to trial next spring.
For more information visit www.nrf.com
Senate Minority Leader Trent Lott (R-MS) discusses key legislation with retail leaders. Front: Tracy Mullin, NRF President and CEO, and Arnold Zetcher, Chairman, President and CEO of Talbots. Back (from right): Gordon Segal, CEO of Crate & Barrel and NRF Chairman, Paul Charron, Chairman and CEO of Liz Claiborne, Henry Berlin, CEO of Berlin’s Brothers, Ed Mosher, President of Mosher’s Ltd., and Steve Ladwig, President of Retek.
▼
▼
House Rules Committee Chairman David Dreier (R-CA) (above) and Senator Rick Santorum (R-PA) (below) discuss issues with retail executives.
▼ Senator John Ensign (R-NV) voices support for trade and terrorism insurance legislation sought by NRF on behalf of the retail industry.
" NRF worked with the Streamlined Sales Tax Implementing States organization on a plan to simplify the nation’s complex web of sales tax laws. Simplification will lessen compliance burdens for multi-state companies and could ultimately pave the way to a requirement for mail-order and Internet merchants to collect sales tax. " NRF won a two-year extension of the Welfare to Work and Work Opportunity Tax Credit programs, which have helped retailers hire more than 250,000 workers. " NRF worked with the Federal Trade Commission and Federal Communications Commission to ensure that proposed federal “do-not-call” lists for telemarketers don’t keep retailers from making legitimate calls to existing customers. " Normal Trade Relations status for Vietnam was extended by one year, allowing Vietnam to grow as one of retailers’ major sources of textiles, apparel, footwear and consumer electronics.
" NRF worked to have a new “user fee” removed from the port security bill, saving retailers and other importers $650 million annually. " NRF fought the CHIP Act, legislation that would force retailers to collect a $10 recycling fee on every computer sold. POLITICAL ACTIVITY " NRF’s RetailPAC augmented legislative efforts by raising nearly $130,000 in 2002. Seventy of the 73 retail-friendly candidates supported were elected — an incredible 96 percent! In addition, NRF held seven retail industry fundraising events that raised more than $90,000 for prominent lawmakers such as Senate Finance Committee Chairman Max Baucus, House Judiciary Committee Chairman James Sensenbrenner, and Senators-elect Norm Coleman and Lindsey Graham.
5
Senate Majority Leader Tom Daschle, center, meets with (left to right) NRF Senior Vice President of government relations Steve Pfister, South Dakota Retailers Association President-elect Phil Lampert, SDRA President Kent Baker and SDRA Executive Director Jerry Wheeler.
U.S. Secretary of Labor Elaine Chao, left, speaks with National Retail Federation President and CEO Tracy Mullin at NRF’s 67th Annual Washington Leadership Conference.
▼
▼
▼
▼
U.S. Senator Rick Santorum (R-PA) speaks with Macy’s East Vice President for Government Affairs Ed Goldberg, right, at the Washington Leadership Conference.
Senator Don Nickles, left, speaks with Bob Benham, President of Balliet’s department store, and his wife, DeDe Benham.
NRF Washington Leadership Conference Takes Retail Issues to Capitol Hill
6
▼
NRF’s 67th annual Washington Leadership Conference brought dozens of CEOs, government affairs executives, state retail association officials and independent retailers together to meet with members of Congress on critical retail industry priorities. Five of Congress’ most influential lawmakers were among the speakers at this year’s conference, which also featured U.S. Secretary of Labor Elaine Chao and a private White House briefing on the economy by R. Glen Hubbard, chairman of President Bush’s National Economic Council.
Senator Orrin Hatch, R-Utah, opened the two-day conference while Senators John Ensign, R-Nev., and Rick Santorum, R-Pa., joined House Rules Committee Chairman David Dreier, R-Calif., in speaking before retailers the second day. Senator Bob Bennett, R-Utah, spoke at a private dinner for retail CEOs. Trade, bankruptcy reform, terrorism insurance, welfare reform and the economy were among the topics discussed as more than 100 retailers gathered in Washington for the annual event. In addition to the briefings and speeches, retailers fanned out across Capitol Hill for more than 80 lobbying meetings with lawmakers and their staffs. The conference wrapped up with a congressional reception at the U.S. Capitol attended by key lawmakers.
Ed Mosher (left) and Gordon Segal (right) chat with U.S. Senator Bob Bennett (R-UT).
For more information visit www.nrf.com
Ohio Senate President Richard H. Finan, right, receives the National Retail Federation’s Legislator of the Year award for his national leadership on sales tax simplification. From left are Ohio Council of Retail Merchants President and CEO John C. Mahaney Jr.; NRF President and CEO Tracy Mullin, and Finan.
▼
State and National Conference Highlights State-Level Retail Issues More than 100 retail executives from across the nation gathered in Napa, California this year for NRF’s 26th Annual Conference of State and National Retail Executives. While NRF’s government affairs efforts in Washington are focused primarily on federal issues, the state and national conference provides an annual forum for retail executives to network and discuss issues of concern to the retail industry on the state level. All 50 state retail associations are invited to attend. In addition to the state associations, a number of specialized national associations participate, such as NRF’s National Council of Chain Restaurants, the National Association of Chain Drug Stores, the Food Marketing Institute and the Direct Selling Association.
▼
▼ South Dakota Retailers Association Executive Director Jerry Wheeler, left, speaks with Texas Retailers Association President and CEO Chuck Courtney, right, during the National Retail Federation’s 26th Annual Conference of State and National Retail Executives.
Michigan state Senator Joanne Emmons speaks at a panel discussion on sales tax simplification.
The conference also enjoys strong participation from major retailers and companies that provide services to retailers. A highlight of the four-day conference was the presentation of NRF’s annual Legislator of the Year award to Ohio Senate President Richard H. Finan for his national leadership on sales tax simplification. Finan addressed state budget issues and was introduced by New York state Senator Steven Saland, the 2001-2002 president of the National Conference of State Legislatures. The conference also featured discussions on electronics recycling, telemarketing “do-not-call” lists, sales tax holidays and sales tax simplification, port security and trade issues, and food safety and labeling. The NRF Policy Council met as part of the conference, as did the National Association of State Retail Association Executives. In a major move for state associations, NASRAE voted during its meeting to rename itself the Conference of State Retail Associations (CSRA).
7
2 Public Relations NRF Drives Media Coverage of the Industry and Diffuses Potential Crises with Strong Public Relations Campaigns
▼
Tracy Mullin with “Today’s” Matt Lauer following Black Friday.
NRF has continued its tradition of being a thought leader on retail issues in the media. Through our media outreach efforts, NRF spokespeople have provided consistent commentary in key news outlets such as the Wall Street Journal, New York Times, Washington Post, USA Today, FORBES, Business Week, CNN, CNBC and FOX. Scores of radio, television and print stories arranged by the NRF public relations team helped build the public pressure that led President Bush to reopen West Coast ports after a waterfront labor dispute threatened retailers’ supply of merchandise during the crucial holiday sales season. NRF’s public relations team put together a major radio and print advertising campaign in support of NRF’s efforts to win passage of bankruptcy reform legislation that would have helped save retailers billions of dollars in bad debt each year. NRF routinely drives stories and provides vital commentary and statistics for virtually every holiday, from Halloween to the Holiday season. Working with the media and member companies, NRF has:
▼
Secretary of Commerce Don Evans and NRF President and CEO Tracy Mullin hold a joint press conference to release retail sales numbers for November.
8
" Developed a Public Relations Committee, providing a forum to identify key retail issues, create best practices in retail PR and develop messaging for the press. " Further positioned itself as an industry thought leader by developing and promoting new original research such as the Retail Executive Opinion Survey and the Consumer Intentions and Actions Survey.
For more information visit www.nrf.com
▼
▼
▼
Maria Bartiromo interviews NRF President and CEO Tracy Mullin on CNBC’s “Closing Bell”.
Mallory Duncan, NRF Senior Vice President and General Counsel is a frequent industry spokesperson.
Erik Autor, NRF Vice President and International Trade Counsel discusses the West Coast Port dispute on Bloomberg TV.
" Created the NRF Update, a new monthly e-mail publication to keep members plugged in to the latest NRF news. " Begun publication of Retail CEO Insider, a new newsletter exclusively for CEOs of NRF member companies. " Added a new News Photo Service that allows the print media to obtain publication-quality photos from NRF news events in time for same-day publication. " Created a new Radio Actuality Line expanding NRF’s outreach to the broadcast media by making it possible for deadline-driven radio stations across the country to download sound bites to accompany news releases day or night, 365 days a year.
In 2003 and the years ahead, the media will continue to turn to NRF as a credible and informed source of information about the retail industry. NRF’s historical success working with the media continues to thrive and expand, with new opportunities generated daily.
9
A bird’s eye view of the NRF Annual Convention EXPO Hall.
▼
▼
10
▼
U.S. Secretary of the Treasury Paul O'Neill speaks to the NRF Board of Directors.
▼
Gordon Segal, CEO of Crate & Barrel becomes the new Chairman of the NRF Board of Directors.
Phil Francis, President and CEO, PETsMART addresses the Annual Convention.
For more information visit www.nrf.com
3
Conferences
NRF 91st Annual Convention & Expo: Retail’s BIG Show The “Big Show” lived up to its esteemed moniker in January 2002, when the retail industry descended en masse on New York City for the NRF 91st Annual Convention & EXPO. Although the struggling economy and widespread fears about traveling put a major dent in attendance at most trade shows and conferences during the year, Retail’s Big Show was only slightly off the record attendance reached in January 2001 and traffic in the EXPO Hall grew this year. 2002 STATISTICS: " Overall attendance was 12,500 " EXPO Hall traffic exceeded by 7% the record set in 2001 " International attendees came from 42 countries, constituting 14% of total attendance " Registered guests represented 46 states in the U.S. " 250 companies filled the EXPO Hall to capacity " 94% of all attendees can recommend, suggest or have final say in purchasing decisions. This is 11% above the national average. (According to Exhibitor Magazine, July 2002)
Loss Prevention and Internal Audit Professionals Converge in Texas for 2002 LP Conference
Mark Bozek, CEO, HSN (second from left),Terry Lundgren, President, COO and CMO, Federated Department Stores, Leonard Lauder, Chairman, The Estée Lauder Companies, Roger Farah, President and COO, Polo Ralph Lauren Corporation, and Jonathan Lipsky, Chief Economist, JP Morgan, Chase and Company discuss the Economic Outlook for the Retail and Consumer Products Sector for 2002 with Peter Brown (far right) and Stephanie Shern (far left) of Kurt Salmon Associates.
More than 1400 loss prevention professionals attended the Loss Prevention (LP) Conference & Exhibition and Internal Audit Executives Conference, in June 2002. They experienced three days of educational programs, peer-topeer networking, guest speakers and product demonstrations from the 150 companies in the exhibit hall. Holly Reynaldo, a Raleigh-Durham Police Department Investigator, received the NRF Law Enforcement Retail Partnership Award at the conference for her outstanding efforts to help Carmax recover stolen assets. This award has been established to help foster stronger working partnerships between the loss prevention community and local law enforcement agencies 11
Loss Prevention Conference Ron Kirk, a candidate for Governor ofTexas in 2002, speaks at the Loss Prevention Conference.
▼
Attendees hear insights from Stuart Varney at 2002 Loss Prevention Conference.
▼
▼ Lee Eisenberg, EVP, Lands’ End, speaks on creativity and how well chosen words and pictures combine to tell the real story.
▼
Scenes From the 2002 Loss Prevention and Internal Audit Professionals Conference.
RAC
12
This year’s Retail Advertising Conference drew retail marketing and advertising professionals from across the nation. Celebrating its 50th year, RAC saluted the many supporters who have helped create a friendly environment of exchange and sharing for the retail industry. The theme “The Art of Storytelling” focused on the story of some of the most successful brands in the industry. At the 2002 RAC we heard the story of several successful brands from speakers like M. Farooq Kathwari, Chairman, President and CEO, Ethan Allen; Bob Rodgers, President, The Great Indoors; Roy Spence, President, GSD&M/Krispy Kreme Doughnuts;
John Kimball, Senior Vice President, CMO, NAA presents the newspaper partnership award during the 2002 RAC Awards Dinner.
▼
that work to help retailers in their fight to reduce losses to their companies. The Internal Audit Executives Conference is co-located with the Loss Prevention Conference each year. This is the conference of choice for retail-specific education on the issues and challenges that face auditors in today’s retail environment. This conference has gained momentum as a result of recent changes in legislation and SEC regulations. The 2003 NRF Loss Prevention Conference will be hosted in San Antonio, TX in June 2003. For the first time in its history, the conference will take place from Tuesday through Friday, instead of Sunday through Wednesday.
CRMretail
▼ Peter Schmid, Senior Vice President, Marketing and Sales Development, Television Bureau of Advertising (TVB) presents the Innovative Retailer of the Year Award at the RAC Awards Dinner.
Tina Wilcox, FAME/Wilsons — The Leather Experts; Lee Eisenberg, Lands’ End; Paul Higham, Wal-Mart; Rob Gruen, President and CEO, Parisian; Pat Mitchell, CEO of PBS, and more. This year also marked the loss of long-time retail industry expert, visionary and motivator, Peter Glen. RAC took a moment to reflect on Peter’s contribution to retail marketing over several decades with a video tribute to his work. RAMA Chairman Marcia Tabler of Lands’ End emceed the annual RAC Awards Dinner with an introduction from Harry Smith of A&E’s Biography. Target Corporation was once again recognized by the panel of judges as best of show for their clever execution and creativity.
The National Retail Federation launched a new conference this year, CRMretail, designed to bring industry experts together to begin an ongoing dialogue around the issues and challenges that face retailers as they implement and develop Customer Relationship Management (CRM) in their companies. This conference was produced in close partnership with Ogden Associates Inc., which was instrumental in gathering knowledgeable speakers and developing the latest retail-specific research on the status of CRM in the industry. The conference was held in Baltimore, Maryland and drew an audience of over 175 participants from across the country, with twenty international members in attendance. Generous sponsorships and exhibitors were critical to the success of CRMretail. Blue Martini hosted the opening reception as well as participating in the conference. At the inaugural conference, the CRM Retail Idea Exchange Working Group was launched. The group of retailers will meet regularly to discuss issues, topics, technology and challenges in CRM, and determine the content for future conferences. CRMretail provides a great environment for retailers to meet other retailers and vendors who are champions of CRM in the retail industry. The conference focused on new research, best practices and the impact of CRM in generating profits in the future for retailers.
13
NRFtech: IT Leadership Summit Drives Future of Retail Technology
▼ Moderator Rick Gallagher of NRF poses questions to roundtable participants (from left) Gary Davenport, Hudson’s Bay Co., Bill Finefield, Navy Exchange Service Command (NEXCOM), Guillermo Siman, Almacenes Siman, and Dave Hogan, Duty Free Americas.
NRF’s CIO Council ran a new kind of meeting this past August in San Diego. Members gathered with peers to talk with influential technology providers about where retail technology is going and what’s needed to make it better. NRFtech: IT Leadership Summit attracted key technology leaders from fifty major retail companies; they met to examine industry best practices and to discuss how to improve the landscape. Using an audience response system to capture answers in real time, participants agreed on important trends that will define the retail technology experience in the next year. The trends members noted include:
Phil Wilkerson, Home Depot
▼
" This is the “season of delivery.” Projects must be brought in successfully, on budget, and with demonstrable return on investment. Retail IT sees many new opportunities to create markets and serve customers – but is constrained by staffing limits and by the demands of multiple concurrent projects. This does not mean that IT spending is down – 65% of retailers polled say that IT spending has already increased or never slowed down.
▼
Ken Harris, GAP, Inc.
" Managing costs is key. Publicly held companies don’t want to disappoint Wall Street. The main focus now is to manage costs, wringing every nickel out of every project, and minimizing costs-after-purchase. IT shops want to be using fewer products, fewer vendors, and want to offer better helpdesk support on a smaller list of software products. " Customers will get more attention. CRM, customer databases, and clienteling systems that can maximize multi-channel return continue to be a major focus area. As more stores are wired for Web connections, more transaction data will be available to allow better sales forecasting and customer service. " Visibility creates measurable results. Business intelligence continues to be a major focus. Analytics products show dramatic returns for markdown optimization, merchandising, pricing, and assortment planning.
14
▼
Paul Butka, TJX
▼
Victoria Cantrell, Gucci
▼
For more information visit www.nrf.com
Ann McCool of Radio Shack speaks while Dennis Harris, Genesco, looks on.
▼ Panel including (left to right): Mike Ragunas, Staples.com; Mike Jones, Hollywood Video; Joe Giordano, ExxonMobil; and incoming chair of the CIO Council Evelyn Follit of Radio Shack address IT challenges for retailers.
The most promising applications enhance demand forecasting and analyze which items sell best with other items. Decision support tools are being used more often; retailers are revisiting business rules to get the most out of them. " The Web finds its niche. Retailers continue the process of “Webifying” everything — bringing persistent connections into the store. They’re looking for bigger bandwidth.
" Supply chain, supply chain, supply chain. Supply chain management continues to be an important area for business process improvement and for technology deployment. Many retailers report that enhanced merchandise and inventory management tools are the top IT implementation goals for this coming year. " Be prepared. Companies are looking at ways to increase their disaster preparedness and business continuity posture. The mood was upbeat at the meeting, and attendees are optimistic about the future. They’re busy, they’re focused, and they are looking forward to next year’s projects. Members will compare notes at the 2003 NRFtech: IT Leadership Summit, August 9-12, 2003 in San Diego.
Cathy Curless, Payless Shoe Source
▼
" Smart POS will be everywhere. Many retailers report that they will conduct major implementations of new point of sale devices; hundreds of thousands will be deployed in the next year.
15
CEO Forum
4 Member
▼
A casual conversation at NRF’s mid-year Board Meeting. From left are: Bob Corliss, The Athlete’s Foot Group; Shelley Nandkeolyar, Martha Stewart Living; Jim and Alison Zimmerman, Federated Department Stores; Lisa Harper, The Gymboree Corporation; and Kathy DeCarlo, Principal, DeCarlo Consulting.
Mid-Year Board Meeting and CEO Forum Draws The Nation’s Top Retail Executives
▼
Gordon Segal, left, CEO of Crate & Barrel, chats with fellow NRF Board Officer Arnold Zetcher, Chairman, President and CEO, Talbots and his wife Ellen.
▼
Jim Zimmerman, center, Chairman and CEO, Federated Department Stores, and his wife Alison, talk with Mark Larson of KPMG, which sponsored the meeting.
16
Specialty (Auto, Drug, Office, Pet, Toys) 41%
▼
Membership by Type
NRF brings retailers and suppliers together at industry conferences and other venues, making it easier for retailers to locate products and services that meet their business needs.
Brian Devine, President and CEO, PETCO, speaks with former U.N. Arms Inspector Richard Butler.
▼
2002 Domestic Retail Membership
▼
In May 2002, CEOs from the nation’s top retail companies gathered at the Bacara Resort and Spa in Santa Barbara, California, where they discussed a number of pressing industry issues and considered possible solutions. Removed from distractions, the arena proved perfect for networking and information sharing, and also included presentations by some of the leading minds in business and politics. Russell Reynolds, an expert on corporate governance issues shared his thoughts about corporate boards of directors in a post-Enron environment. Lanny Davis, a partner with the law firm of Patton-Boggs LLP, provided insights into crisis communications strategy, and Richard Butler, former U.N. Chief of Arms Inspection in Iraq, joined the executives for a dialogue about the geo-political climate. Finally, Howard Fineman, Newsweek magazine’s Chief Political Correspondent, Senior Editor and Deputy Washington Bureau Chief, offered his “inside the beltway” insights with the group. The two-and-a-half day event included a meeting of the NRF Board of Directors and also featured other speakers, agenda setting meetings and networking events.
Services Hardware, House Ctrs., Furniture Housewares 5% 2% Jewelry 2%
Strategic Partnerships Reap Rewards for Retail Industry as Key Studies and Initiatives Roll Out in 2002
Food, Beverage 1% Sports, Entertainment 2% Discount Dept. Stores 3%
Department Stores 13%
Computers, Electronics 1%
Arts, Collectibles, Gifts 7% Apparel, Accessories, Shoes 23%
NRF’s Membership Appeals to All Segments NRF MEMBERSHIP A VIBRANT MIX OF CATEGORIES Over the years, NRF has moved from its roots of predominantly department stores to a vibrant, fiscally healthy mix of categories and industry segments. Over the past two years, this mix has held steadily. Through the diverse but unified voice of our retail membership, NRF has positioned itself as the definitive advocate for retail, both on Capitol Hill and in the boardroom.
RETAIL HORIZONS AND NRF UNIVERSITY wired LAUNCHED Through the support of NRF’s core partnerships with such firms as Sun Microsystems and BearingPoint, NRF has been able to better serve the needs of its diverse member base. New strategic partnerships formed in 2002 for value-added, retail-specific services include: " NRF Membership Needs Assessment
" NRF University wired
" CRMretail Study
" IT-Related Studies and Supply Chain Expertise
" Retail Horizons
" Executive Opinion Trends Study
“The value we have derived from just a year and a half of membership has been exceptional. The NRF is the definitive artery to the retail executive community, and our investment and focus of time, resources, and intellectual capital into NRF programs has yielded tremendous awareness and recognition—for both our organizations. Unlike other more orthodox associations, the NRF is open and receptive to all ideas or activities that will benefit its constituency. This rapport of innovation and exploration—of partnership, really—is what sets NRF apart and is certain to attract a growing membership— both from retailers and associate members alike in the years ahead.” JERRY BLAESING, Senior Vice President, Retail/Wholesale, BearingPoint
17
Member Services
Uncertain times not a deterrent to NRF support In 2002, support from all business partners increased nearly 30% over last year — with nearly half of all companies listed on last year’s Honor Roll increasing their support for 2002. Over 30 companies attended the 2002 Business Partners Meeting in conjunction with NRF’s Annual Convention & EXPO.
NRF thanks these Honor Roll Strategic Partners
{
NRF FINDS NEW WAYS TO SERVE DIVERSE MEMBERSHIP MIX From NRF’s new “Networking Nights” to teleconference calls managed by NRF committee liaisons, NRF is finding alternate ways to mingle with members and meet their diverse needs. NRF members are reached through every communication channel: " Monthly E-Newsletter, NRF Update " NRF Networking Nights, intimate dinners located in cities traditionally not visited by NRF
18
" Monthly membership mailings directed to divisional and department heads at member companies
For more information visit www.nrf.com
NRF welcomes these new Honor Roll Strategic Partners New firms added to the NRF Honor Roll of Strategic Partners who contributed over $50,000 in participation or value-added services this year: " AMR Research
" Oracle
" Bank of TokyoMitsubishi Ltd.
" QRS " SAS Institute
" BearingPoint " Thompson Associates " CareerBuilder " Wincor-Nixdorf " Gartner DataQuest
" Quarterly teleconference briefings for members interested in hearing more about NRF’s government affairs activities – as well as specific topics designed to equip our members for the ever-changing environment of retail:
" Expanded committees for retail companies looking to get more involved " New conferences and committees designed to meet emerging needs:
" Vendor Allowances
" CRM Retail Idea Network
" MD&A Disclosure Rules
" CRMretail: Customer Relationship Management Conference
" Risk Management and the Cost of Insurance
" NRFtech: IT Leadership Summit
" Supply Chain Strategies
" Merchandising: New Basics and Winning Strategies Workshop
19
NRF Expands Its World-Wide Presence As Retailing Becomes An Increasingly Global Business
Mr. Wang Shupei, Director General for the China General Chamber of Commerce (CGCC) (center) and Mr. Shen Shi, Section Director for CGCC, meet with NRF staff, from left, Tatiana Tolentino, Tracy Mullin, and Karen Knobloch.
NRF President Tracy Mullin chats with HiroshiTsuruzono and Hiroko Isaka of the Japan Retailers Association.
▼
China General Chamber of Commerce — China General Chamber of Commerce (CGCC) is a national social organization under direct administration of the State Economic & Trade Commission P.R.C. The CGCC manages about 500 members.
NRF spokespeople represent the U.S. retail industry in international forums. NRF President and CEO Tracy Mullin (above) at a German retail industry event.
▼
The International Retail Forum (IRF) promotes information sharing among retail trade associations around the world, and identifies opportunities for cooperation in research and education. The IRF has members in Asia, Europe, South America and North America; membership is open to all national retail associations outside of the United States. NRF welcomes the newest IRF members — China, Thailand and Switzerland.
20
▼
▼
▼
Jose Maria Castellano Rios, Deputy Chairman and CEO of Inditex (right), receives the International Retailer of the Year Award from then NRF Board of Directors Chairman Richard L. Sharp.
▼
Clockwise from left: NRF’s Denise Brassé meets with Mr. Nelson Barrizzelli of Confederação Nacional de Dirigentes Lojistas (CNDL), and Mr. Sebastião Mauro Figueiredo Silva, President of CNDL, NRF’s Tatiana Tolentino and Daryl Everett.
For most retailers, doing business is an international affair. Merchandise on the store shelves comes from the four corners of the globe. Many retailers have expanded their selling-reach across geographic boundaries and operate stores in multiple countries. NRF helps retailers navigate the complicated issues that are inherent in doing business around the world.
NRF’s Board is geographically diverse, including, for example, Cem Boyner, Boyner Holdings, Turkey (center).
Thai Retailers Association — The Thai Retailers Association first came into existence about 20 years ago. Their goal is to strengthen unity, cooperation, and coordination among members to improve the retail industry. The Thai Retailers Association has 126 members (70 retailers and 56 associate members). Intercontinental Group of Department Stores (IGDS) — The Intercontinental Group of Department Stores (IGDS) was founded in 1946 in Switzerland. The IGDS organizes more than 20 conferences per year and provides significant opportunities for networking and information exchange.
INTERNATIONAL RETAILERS VISIT U.S. International attendance at NRF’s Annual Convention and EXPO continues to grow with large groups of retailers coming from Brazil, Canada, Mexico, Spain and Israel in January 2002. The NRFtech IT Leadership Summit held in August 2002 attracted registrants from four continents, and countries including Australia and South Africa. IT leaders compared best practices for varying economies and stages of implementation during the Summit. US attendees valued the opportunity to compare notes with international companies regarding their varying experiences with technology issues. NRF VISITS ABROAD In order to strengthen NRF’s ties with its international trade association counterparts (the IRF) and other organizations outside of the United States, NRF staffers frequently travel abroad as representatives of the U.S retail industry. In March, NRF’s Manager of International Operations Tatiana Tolentino traveled to Guadalajara, Mexico to attend the 24th Annual Convention and EXPO of Mexican partner ANTAD (Asociación Nacional de Tiendas de Autoservicio y Departamentales). Tolentino participated in various events there including the Opening Super Session headlined by Mexican President, Vicente Fox. In September, Tolentino and Rick Gallagher, Publisher of STORES Magazine attended ANTAD’s General Merchandise Conference and EXPO in Mexico City where Gallagher participated as a speaker on “Six Mega Trends In Retail.” In October, Tracy Mullin accepted an invitation to speak in Berlin at the 2002 German Retail Conference hosted by Hauptverband des Deutschen Einzelhandels. This conference drew an audience of about 800 prominent retailers from Germany and elsewhere in Europe, and tackled issues including globalization and competition from abroad. The Association for Retail Technology Standards (ARTS) played a significant role in the NRF international program in 2002. Executive Director Richard Mader spoke at the annual CIO meeting of the International Association of Department Stores (IADS) in Paris and made a presentation to the Marcus Evans conference in London. In addition, ARTS hosted meetings in Madrid, Spain. To increase awareness of the benefits technology standards provide for the retail industry, ARTS developed a special education program for European retailers, conducting sessions in London, Paris, The Hague and Dusseldorf.
NRF Members Receive Valuable Benefits and Discounts In 2002, the Member Discount Program (MDP) continued to offer business products and services at specially negotiated rates to NRF members. NRF welcomed CIC Enterprises as a partner this year. Through CIC, NRF members receive Work Opportunity Tax Credit (WOTC) and Welfare to Work (WtW) administration, State Incentive consulting and other money saving programs—helping them recover hundreds of millions of dollars in Federal, State and Local monies for retail companies nationwide. Independent retailers receive a quarterly newsletter with updates and information on new and existing NRF discount programs, highlighting products and services to fit their special business needs. Member Discount product and service offerings include: " Recruitment solutions
" Retailing supplies
" Tax credit recovery
" Credit card processing and more
" In-store fixtures
Additionally, NRF members receive legislative updates, groundbreaking research, special discounts on publications and other services. NRF is always looking for new ways to help members cut their costs and improve their operations. Many exciting new benefits will be unveiled throughout 2003.
Independent Stores Board The Independent Stores Board of Directors is comprised of chief executives of independent member businesses. This board advises the Executive Committee on matters related to small store retailing. They work closely with the NRF staff to ensure that services, programs and government representation accurately address the current and future issues confronting independent retailers such as Bankruptcy Reform, Minimum Wage and Health Care initiatives. This year the board initiated three sub-committees to further their efforts in three major arenas: Policy, Membership, Education and Research. The Independent Stores community actively participates in the NRF Annual Convention and Expo. Members of this board are often called upon to speak on behalf of retailers at meetings on Capitol Hill and support other lobbying efforts as needed. They meet regularly throughout the year to network and share best practices for small store retailing.
21
5 Advisory Committees BOARD OF DIRECTORS & STANDING COMMITTEES Board of Directors The NRF Board of Directors is the governing body that oversees the activities of the Federation. It is comprised of leading retail chief executive officers representing the breadth and diversity of the industry. Regular meetings of the Board of Directors are held in January in New York City in conjunction with the Annual Convention and Exposition and again in the spring or early summer. NRF staff contact: Tracy Mullin
Executive Committee NRF’s Executive Committee has most of the authority of the Board of Directors and serves as the ad hoc committee to determine strategic planning and direction for the Federation. Each member of the Executive Committee is elected by the Board of Directors. The Chairman of the Board of Directors presides over the NRF Executive Committee. NRF staff contact: Tracy Mullin
Finance Committee This committee is elected by the Board of Directors and oversees the finances of the Federation including reviewing and recommending the Federation’s budget to the Executive Committee and the Board of Directors. The committee also advises the Board on general matters relating to financial and accounting issues. NRF staff contact: Carleen C. Kohut
Awards and Nominations Committee NRF’s Awards and Nominations Committee reviews nominations for Directors and members, and prepares slates of nominees for consideration by the Board and for election by the NRF membership. The Awards and Nominations Committee also makes recommendations for recipients of NRF awards and honors, including the NRF Gold Medal, International Retailer of the Year, Retail Innovator of the Year, Distinguished Service, American Spirit, Leadership in Public Service and the Silver Plaque Awards. NRF staff contact: Tracy Mullin
Independent Stores Board Comprised exclusively of chief executives of independent member firms, members of the Independent Stores Board provide invaluable advice to NRF in the development of programs and services, especially in the areas of conferences and member discounts, to meet the needs of the smaller stores community. The Independent Stores Board advises the Executive Committee on matters related to small store retailing and works closely with NRF staff to ensure that services, programs and government representation accurately address the current and future issues confronting independent retailers. The Chairman of the Independent Stores Board is appointed by the NRF Executive Committee. NRF staff contact: Steve Pfister
ADVISORY BOARDS, COUNCILS, AND COMMITTEES NRF relies on an interactive committee structure, open to NRF retail members in good standing, for the formulation and execution of policies, guidelines, standards and strategies consistent with retail industry objectives. The NRF committees are, without exception, designed to be representative of the industry and reflect its breadth and diversity. They are comprised of industry specialists in their individual fields who give generously of their time and knowledge to set policy and help develop positions on important retail operations or public policy issues which will benefit the industry at large. Existing for the purpose of advancing the retail industry, NRF councils and committees may engage in a number of activities, including:
This Board of Directors, made up of chief executives of major retail and supplier-partner firms, directs and oversees the programs, activities and functions of the NRF Foundation, the non-profit research and education arm of the National Retail Federation. Members are elected by the NRFF Board and approved by the Federation’s Board of Directors. NRF staff contact: Katherine Mance
ADA Task Force A group comprised of NRF retail members interested in the Americans with Disabilities Act and any resulting or pending federal regulations or litigation. NRF staff contact: Mallory B. Duncan
ARTS Consortium Europe
" Product development
ARTS Consortium Europe is the formal organization of ARTS European members to support standards development by organizing committees to enhance the Data Model and develop XML documents and messages. This work supplements the efforts of similar US based committees.
" Shared opportunities for purchase of services
ARTS staff contact: Richard E. Mader
" Information exchange " Setting of public policy positions " Research " Benchmarking
" Presentation of testimony " Standards setting " Publishing
22
NRF Foundation Board of Directors
For more information visit www.nrf.com
CFA Product Registration Committee The committee was set up in response to a petition from the Consumer Federation of America (CFA) to the Consumer Product Safety Commission (CPSC) that retailers, manufacturers and distributors be required to collect and house consumer contact information on products sold for a period of 20 years via a pre-paid mail back postcard. The intent of the cards is to provide accurate information in the event of a recall. All NRF members are welcome to join. NRF staff contact: Jennifer Kurrie
CIO Council An invitation-only committee made up of retailing’s most prominent chief information officers. It meets in winter, spring and summer to discuss issues of common interest, promising technologies, and to take a proactive stance on creating new technology environments. It provides a valuable opportunity for peers to share ideas and experiences, and in doing so helps guide the National Retail Federation technical staff to create new projects that reflect the industry’s needs. NRF staff contact: David Hogan
Committee on Employment Law This committee serves as NRF’s technical committee on labor law and employee relations matters, and is comprised of retail indus-
try corporate executives and independent labor counsel, as well as human resource and employee relations executives from NRF member companies and associations. Each year, the CEL files amicus curiae briefs in high profile cases pending before the NLRB and federal courts. NRF staff contact: Katherine Lugar
Conference of State Retail Associations (CSRA) CSRA was founded in 1991 and is dedicated to increasing the professionalism of state retail association executives, strengthening retailing’s grassroots efforts and serving as a forum for the discussion of retail association management issues and opportunities. Officers serve as an advisory committee to the Federation. Reserved for State Retail Association Executives only.
Credit Executives Committee
Data Model Committee (ARTS)
Electronics Recycling Working Group
This committee provides NRF with strategic and operational advice related to consumer credit issues, including federal legislative and regulatory policy, the standardized credit bureau reporting format, as well as file integrity among retail credit grantors. This group of senior credit executives meets at least twice a year.
This committee shapes the future of the ARTS Data Model. Members propose enhancements, prioritize activities and approve all changes to the Model.
This working group is for retailers interested in developing and advancing an industry position on electronics recycling. Several state legislatures have begun to move toward requiring some form of electronics product recycling typically paid for with an advanced fee collected at point of sale. A federal bill has also been introduced requiring fees and recycling for computers. All NRF members are welcome to join this committee.
NRF staff contact: Mallory B. Duncan
Credit — Bankruptcy Working Group A subcommittee of NRF’s Credit Executives Committee, this group focuses on legislative, regulatory and other solutions to combat rising consumer bankruptcies.
NRF staff contact: Maureen Riehl
NRF staff contact: Mallory B. Duncan Katherine Lugar
Council on Diversity
CRM Retail Idea Exchange
The NRF Council on Diversity leverages the knowledge and expertise of its members to influence the direction of diversity practices within the retail industry. Such practices not only serve an important moral cause but also have a profound impact on the growth and prosperity of the business. The Council educates the industry, media, public interest groups and the general public regarding the multiple benefits of a formal diversity awareness program.
The group discusses issues and concerns related to implementing Customer Relationship Management (CRM) initiatives in their companies. Comprised of large and small retailers, the group focuses on the integration of technology, marketing, operations and strategy in the retail environment to drive sales and profitability. The group also contributes educational content for NRF’s CRMretail conference.
NRF staff contact: Dan Butler
ARTS staff contact: Richard E. Mader
Digital Asset Management Committee (ARTS) This committee reports to the CIO Council and focuses on improvements in image metadata management, including identification methodology and transport guidelines for merchandise information (images and product descriptions) used in multiplechannel retailing. This committee is open to NRF retailer and manufacturer member personnel that are responsible for the management of merchandise data in their catalog, Web or brick-and-mortar stores. NRF staff contact: Germaine Palangdao
E-Commerce Policy Working Group This committee is made up of policy, legal, and IT experts from retail companies with a presence on the Internet. The group addresses e-commerce issues from a policy perspective as they affect retailers in the fast-paced world of e-tailing. NRF staff contact: Liz Treanor
NRF staff contact: Jennifer Kurrie
Financial Executives Council This Council, comprised principally of Chief Financial Officers of member firms, represents all segments of the retail industry. Members focus on business strategies and monitor retail industry financial services activities, with special attention devoted to tax and accounting issues. This group also provides important input into development of program content for key NRF conferences and other educational programs. NRF staff contact: Carleen C. Kohut
continued on next page
NRF staff contact: Dan Butler
23
ADVISORY BOARDS, COUNCILS, AND COMMITTEES continued
Health & Employee Benefits Committee This committee consists of senior- level retail benefits executives who provide technical input on a wide range of health and other benefit issues. The committee meets on an ad hoc basis as needed.
Internal Audit Advisory Council
This subcommittee of the ITAC provides guidance and technical expertise on trade issues that specifically affect textiles and apparel. The subcommittee confers on an ad hoc basis. NRF staff contact: Erik Autor
NRF staff contact: Erik Autor
ITAC — Hardgoods Subcommittee
ITAC — Trade and E-Commerce Subcommittee
This subcommittee of the ITAC provides guidance and technical expertise on trade issues that specifically affect consumer products other than textiles and apparel. The subcommittee confers on an ad hoc basis.
This subcommittee of the ITAC provides guidance and technical expertise on international issues affecting the ability of retailers to sell their products in foreign markets through the Internet. Some of the issues addressed by the subcommittee include the imposition of customs duties on electronically transmitted products, market access, and negotiations on e-commerce at the World Trade Organization. The subcommittee also is a working group of the NRF Tax and Privacy Committees. In this capacity it also helps formulate industry positions on the interna-
Human Resources Specialty Store Roundtable
NRF staff contact: Mallory B. Duncan
In addition to planning the annual Financial, Credit and Internal Audit Executives Conference, this council conducts an annual forum for the exchange of ideas and solutions to industry audit concerns. The committee conducts its own annual internal benchmarking survey, available to participants. Representatives from each of the large public accounting firms provide input and guidance to the council.
24
This committee is concerned with organizational issues in field operations and compensation and benefit considerations for specialty store chains. It conducts an annual Specialty Store Compensation and Benefit Survey for the retail industry.
NRF staff contact: Dan Butler
International Trade Advisory Committee (ITAC) The ITAC members include senior retail sourcing, compliance, and government relations executives and general counsels, who are responsible for international trade, customs, and international labor issues for their companies both on the legislative and regulatory fronts. In 2001,
NRF staff contact: Erik Autor
NRF staff contact: Erik Autor
ITAC — Customs Subcommittee This subcommittee of the ITAC provides guidance and technical expertise on customs and trade facilitation issues affecting retailers as well as relations between the U.S. Customs Service and the
tional aspects of Internet taxation and Internet privacy. The subcommittee confers on an ad hoc basis. NRF staff contact: Erik Autor
ITAC — Supplier Compliance Subcommittee
ITAC — Softgoods Subcommittee
This invitation-only council is limited to the most senior legal officers among NRF’s retail membership. Two to three times each year they meet to share strategy and ideas for addressing cutting edge legal and management issues of concern to retail law departments, such as alternative dispute resolution, antitrust trends, advertising, benchmarking of legal programs and securities law issues, as well as other matters.
NRF staff contact: Katherine Lugar
NRF staff contact: Erik Autor
NRF staff contact: Dan Butler
General Counsels Forum
The NRF Government Affairs Policy Council is the Federation’s principal policy making body on federal legislative and regulatory issues. Receiving input from other NRF technical committees, the Policy Council reviews pending and proposed legislation and regulation and sets official policy positions as well as implementing strategies and tactics. This invitation-only council is comprised of corporate representatives as well as state and national association executives.
importing community. The subcommittee confers on an ad hoc basis.
This subcommittee of the ITAC formulates the industry’s response to concerns raised about “sweat shop” working conditions in U.S. and international manufacturing operations. The subcommittee has played a key advisory role in assisting the NRF in its position as a member of the U.S. Treasury Department’s Child Labor Advisory Committee. Within the subcommittee, a Sweatshop Education Taskforce developed a website (www.sweatshops-retail.com) aimed at educating the public about industry efforts to ensure that products sold at retail in the United States are manufactured in an ethical manner and in compliance with all applicable laws and regulations. The subcommittee confers on an ad hoc basis.
NRF staff contact: Katherine Lugar
Government Affairs Policy Council
the ITAC played a key role in representing the industry’s interests on efforts to pass trade promotion authority (TPA), implementation of the African Growth and Opportunity Act (AGOA) and the Caribbean Basin Trade Partnership Act (CBTPA), providing new trade preferences for countries of the Andean Region, Congressional approval of the trade agreement with Vietnam, funding a new computer system for the Customs Service, as well as other initiatives to eliminate U.S. and foreign trade barriers and to facilitate trade. The ITAC meets three times a year and has five subcommittees.
IXRetail Technical Committee (ARTS) The IXRetail Technical Committee develops XML documents and messages for use within the retail enterprise. It is composed of XML experts from both vendors and retailers. ARTS staff contact: Richard E. Mader
Loss Prevention Advisory Council This council meets frequently to discuss common problems confronting the security industry and to share new ideas on product and program results. The council is also active in the planning of the Loss Prevention Conference and Exhibition. The council was instrumental in the development of a new series of informational brochures on a variety of loss prevention topics to benefit smaller retail companies. NRF staff contact: Dan Butler
Postal Working Group This working group provides guidance to the NRF in representing retailers on matters before Capitol Hill, the Postal Rate Commission and the United States Postal Service. The committee’s primary focus is first-class mail. The committee also provides testimony on proposed federal legislation which affects mailers generally. The committee meets on an ad hoc basis. NRF staff contact: Jennifer Kurrie
Product Safety Committee
Retailer’s Work-Life Forum
Strategic Supply Chain Council
This committee effectively communicates existing and potential product safety problems within the retail industry and addresses emerging product safety issues by providing substantive and strategic input into the development of industry public policy. In addition, the committee provides comments on proposed regulations before the Consumer Product Safety Commission and communicates the industry’s position on key issues.
The forum meets to examine the challenges of the hourly employee that prevent them from being able to fulfill their work schedule. This creative and unique group examines such important issues as child care, elder care and financial planning initiatives that will give the hourly employee assistance in solving the problems that prevent them from working their schedule. This group works to encourage research and supports all legislative actions in the work-life arena.
This new Council is comprised of retailers, research firms, and software application suppliers. The mission of the Council is to address emerging supply and demand chain trends, to identify retail requirements, and to educate all three distinct communities on best practices, efficiencies and opportunities.
NRF staff contact: Jennifer Kurrie
Retail Privacy Committee The Retail Privacy Committee is composed of senior retail representatives with responsibility for aspects of company operations that affect customer and employee privacy. Due to the breadth of the subject, it is intended to be a cross-functional committee. Most companies have more than one representative on the Committee to ensure their marketing, information systems, human resource, operations and loss prevention interests are represented. Government and public interest group initiatives that could restrict retailers’ use and reuse of personal data, either directly or through limitations on access to credit bureaus, mailing lists, demographic files or other sources fall within the purview of the committee. The committee meets on a regular basis. NRF staff contact: Mallory B. Duncan Liz Treanor
NRF staff contact: Dan Butler
Sales & Service Voluntary Partnership, Inc. Managed and led by the NRF Foundation, hundreds of organizations representing retail, wholesale, personal service and real estate industries have come together in a groundbreaking voluntary partnership to develop a national system of skill standards for industries. The Board of Directors is made up of nationally known cross-industry representatives, educators, national employee representatives and community-based organizations. To remain competitive in a time of rapidly changing technology and business operations, industryled skill standards for education and workforce development are a necessity. The work of the partnership has the potential to transform our education and workforce preparation system and improve both performance in and perception of sales and service careers. NRF staff contact: Kathy Mannes
NRF staff contact: Carleen C. Kohut
Taxation Committee The Taxation Committee provides senior retail tax executives a forum to discuss industryrelated tax issues and serves as an invaluable information and networking resource. The Committee meets three times a year to discuss issues affecting the industry and advises NRF on emerging tax legislation and regulations likely to affect retailers, their businesses, and their customers. Briefings and discussions focus on Federal legislation, regulations, audit issues, and state and local tax matters. The Committee develops legislation, submits testimony, and provides witnesses to represent industry concerns before Congress, Treasury, and the IRS. It also produces publications and memorandums on current retail tax issues. NRF staff contact: Steve Pfister Chad Davis
Tax — Alternative Tax Systems Task Force
Tax — Tenant Construction Allowance
A task force of the Taxation Committee and Policy Council, this group is comprised of senior retail tax and governmental affairs executives and economists from major retail companies who have specific interest in consumption taxes. The Task Force is responsible for initiating and producing research related to tax reform and its impact on retailing and disseminating the results in appropriate forums.
This subcommittee reports to the Taxation Committee. It focuses on legislative and regulatory activism in an effort to provide a clarification of tax treatment of both tenant and construction allowances (inducements) provided to retailers by owners and developers.
NRF staff contact: Steve Pfister
Tax — LCM Working Group This subcommittee reports to the Taxation Committee. Members utilize the Lower of Cost or Market accounting mechanism and work to educate lawmakers about its importance to retailers and consumers. Attempts have been made in recent years to eliminate this GAAP account practice for federal revenue reasons. NRF staff contact: Steve Pfister Chad Davis
Tax — Tax Reform Working Group This is a subcommittee of the Taxation Committee. Its primary purpose is to evaluate and educate retailers, lawmakers and consumers of consequences associated with major national tax reform proposals, including a flat tax or national retail sales tax (NRST). It has commissioned a multi-year study of leading reform proposals and utilizes these results to highlight the ramifications of a NRST on the economy and consumers.
NRF staff contact: Steve Pfister Chad Davis
Tax — WOTC Working Group This ad hoc committee is comprised of corporate Work Opportunity Tax Credits (WOTC) administrators and meets by conference call to discuss specific program procedures and updates when necessary. NRF staff contact: Steve Pfister Chad Davis
UnifiedPOS Technical Committee (ARTS) The Committee enhances and maintains the Technical Specification, the foundation for both JavaPOS and OPOS. ARTS staff contact: Richard E. Mader
NRF staff contact: Steve Pfister Chad Davis
25
6 NRF Divisions NRF Provides Vital Support to Online Retailing Through Shop.org According to Shop.org’s premier annual industry study, State of Retailing Online 5.0, online spending in 2002 is expected to reach $72 billion, an increase of 41-percent compared to 2001. As the industry grew in 2002, so too did Shop.org, NRF’s online retailing division. Shop.org saw significant growth in its membership, event attendance and its stature as the authority in retailing online. As NRF’s online group, more than 220 leading companies are part of the Shop.org community where they enjoy a non-commercial forum for the exchange of information, lessons-learned and expertise on issues related to the Internet and its integration with other channels. HIGHLIGHTS FROM 2002 INCLUDE: " As of November 2002, Shop.org is on pace to add more than 90 new members representing a 40 percent increase in membership for the year. " New members include large multi-channel retailers, catalogers, Internetbased retailers and manufacturers selling direct as well as leading solution providers. A sample of new members includes companies such as Bose, Crate & Barrel, Yahoo!, CompUSA, eBay, Google, Kohl’s, Overstock.com, Polo.com, and Tiffany and Co.
" The Shop.org Annual Summit attracted more than 350 interactive retail executives who gathered to network, share information and hear keynote speakers such as The Sharper Image Founder, Chairman and CEO Richard Thalheimer. " Shop.org held monthly teleconferences on timely topics such as: " Alternative Online Retail Channels for Optimizing Inventory " Online Merchandising " Organizing for Retail eBusiness " Using the Online Division to Move the Needle in Retail " Shop.org held two retailer-only 1.5 day workshops: " Best Practices in Online Marketing, New York " Best Practices in Online Merchandising Workshop, Sonoma, CA
the evolving opportunities and issues related to the Internet
“... the Shop.org report [The State of Retailing Online 5.0 June 2002], conducted for the association by Boston Consulting Group and Forrester Research, is thought to be one of the most complete gauges of online retailing. It incorporates financial figures from closely held companies and bricks-and-mortar merchants that often don’t independently report online sales and profits.
and integration with other channels.
—The Wall Street Journal
“I find Shop.org to be a great source of unbiased, reliable and in-depth research as well as an excellent forum to learn from my fellow members, who are leaders in multi-channel and online retailing.”
“Office Depot participates in Shop.org because it provides terrific networking opportunities with ‘Best in Class eRetailers,’ up to date eCommerce marketplace metrics and informational seminars. It’s an important resource for anyone in eBusiness.”
— DENNIS HONAN, Vice President and General Manager, Customer Direct, Sears, Roebuck and Co.
—MONICA LUECHTEFELD, Executive Vice President, E-Commerce, Office Depot
SHOP.ORG’s MISSION is to help our members significantly improve their multi-channel retail capabilities by addressing
26
" Shop.org released the 5th version of its annual State of Retailing Online research study conducted by The Boston Consulting Group in partnership with Forrester Research. Media coverage included The Wall Street Journal, The New York Times, USA Today, The Washington Post, and others.
Brian Riendeau, VP of Government Affairs, Yum! Brands, talks with Senator Byron Dorgan (D-ND) at the Washington Leadership Conference.
▼
Stepping up to lead the industry on the issue of animal welfare, NCCR, in partnership with the Food Marketing Institute, has been working with the producer community over the past year on establishment of animal welfare guidelines. NCCR nearly completed the process of endorsing animal handling guidelines for all species that will be recommended to NCCR members when choosing their suppliers of eggs, beef, pork, chicken, etc. NCCR has also recently embarked on the development of an audit program to assure that the guidelines adopted are being followed. This initiative has received national media attention and is being hailed as an extremely effective proactive strategy that has helped member companies manage this very difficult issue. NCCR MANAGES A BROAD RANGE OF LEGISLATIVE AND REGULATORY ISSUES ON BEHALF OF ITS CHAIN RESTAURANT MEMBERSHIP NCCR had a very busy and productive year on the government affairs front. The list of issues NCCR managed for the industry over the past year is extensive, and included labor and employment, health care, tax, immigration, food safety, pensions, and trade issues. As part of NCCR’s government affairs strategy, they lobbied Members of Congress and their staffs through personal contacts. As part of that effort, NCCR hosted its annual member “Lobby Days” this year in conjunction with the National Retail Federation’s Washington Leadership Conference. In addition, they employed letter-writing campaigns, and joined forces with other employer trade groups in coalition efforts to fight bad legislation. NCCR successfully fought off an increase in the federal minimum wage for yet another year. Working with others, they avoided enactment of a so-called “patients’ bill of rights.” NCCR also succeeded in extending the Work Opportunity Tax Credit (WOTC) and the Welfare-to-Work Tax Credit (WWTC)
▼
NCCR Continues to Lead the Industry on Public Policy Issues
Members of NCCR's Executive Committee meet with Congressman Darrell Issa (R-CA) at their annual meeting.
for another year. In that vein, NCCR formed a new coalition to lead the charge for permanent extension of WOTC and WWTC. Finally, NCCR launched its new “Week at a Glance” newsletter to keep its members informed of the upcoming legislative schedule during the weeks Congress is in session. This newsletter contains information on legislation and events relevant to the industry. As always, NCCR still publishes its monthly newsletter, “NCCR Highlights,” which provides information on legislative and regulatory activity affecting the industry, as well as general information on NCCR events and updates. NCCR HAS RECORD GROWTH YEAR The National Council of Chain Restaurants enjoyed a year of growth, unprecedented in the last decade, in terms of program development, membership expansion and media coverage. In addition to its regular member meetings held throughout the year, the partnership with the National Retail Federation gave NCCR the opportunity to offer members attendance at the Committee on Employment Law meetings and the Washington Leadership Conference. NCCR has also developed its own employment law committee for those with operations in California. NCCR continues to look for opportunities to develop programs that serve the needs of the chain restaurant industry. NCCR’s membership growth in this past year is impressive. They added El Pollo Loco, Bob’s Big Boy, Domino’s, RARE Hospitality, Dave & Buster’s and Cocos and Carrow’s to their list of members. In a real “tip of the hat” to the organization, a major trade publication, Nation’s Restaurant News, recognized the President of NCCR, Terrie Dort, by selecting her as one of the 30 most influential women in the restaurant industry.
27
ARTS meeting in Spain with Germaine Palangdao, Director, NRF, Jesus Colao, IS Development Director, El Corte Ingles and Richard Mader, Executive Director, ARTS.
Promoting Technology Standards That Benefit the Retail Industry ARTS, the technology standards division of NRF, enjoyed a very successful year as the adoption of standards increases worldwide. Standardization is a key strategy to lowering technology costs and providing stability in the rapidly changing IT industry. Companies are realizing that standards: " Reduce Risk: Standards capture the essence of proven techniques and technology. " Increase Choice: Open standards allow the selection of operating systems like Windows, Linux or Solaris, and enable functionality with almost all network or database management systems (DBMS). " Speed Development: ARTS standards like the Data Model and IXRetail XML messages provide ready-to-use file designs. " Cut Costs: Each of the points noted above substantially reduces cost and implementation time.
Plans for 2003: Following up on the success of 2002, ARTS has aggressive plans to enhance, expand and increase the adoption of retail industry standards. t Data Model’s complete enterprise version will be released in the First Quarter of 2003. 28
▼
▼
Luncheon hosted by El Corte Ingles at the ARTS meeting in Spain with Stuart McGregor, ARTS, Jaroslav Dvorak, Beta Control, Francisca Vicente-Tamarin, El Corte Ingles, Jerry Rightmer, 360 Commerce and Diane McGregor.
The benefit and increased interest in standards is clear as ARTS membership growth in 2002 included key new members, Best Buy, Kinko’s, The Children’s Place, QVC, Mueller GmbH, Pier One and Burlington Coat Factory. ARTS 2002 ACCOMPLISHMENTS: IXRetail, ARTS’ two year investment in developing XML schemas and messages to integrate applications within the retail enterprise was rewarded in 2002 as Longs Drug Stores implemented the Price schema and the Data Model. Smart & Final Inc. implemented the Digital Receipt Standard to increase customer communications and reduce fraud. Shell Oil Company implemented a pre-release version of Remote Equipment Monitoring and Control messages to reduce the cost of maintenance and increase equipment uptime. Retailers and vendors cheered the recent release of the standard XML POS transaction log as a historic advance in easing integration of POS to over 30 systems that use sales data. UnifiedPOS, the ARTS standard for interfacing 24 different devices such as scanners, printers, magnetic stripe readers and PIN pads with sales floor terminals, was greatly enhanced. The check image scanner was added, allowing retailers to convert paper checks into debit card transactions, thus handing the check back to the customer at the point-of-sale. In a key move to explore the advantages of UnifiedPOS, The Gap recently announced a pilot of this process.
t IXRetail will release three new schemas and message sets; Stored Value will integrate gift certificates, store credits, loyalty programs and pre-paid accounts to POS; Digital Asset Management (DAM) will classify and communicate images between manufacturers and retailers; and the full version of Remote Equipment Monitoring and Control will enable central management of store equipment. t UnifiedPOS next version 1.8 will include support for smartcard readers to reduce the time and costs of implementing this more secure payment and loyalty card within retail.
▼
ARTS IX Retail Meeting at Blue Martini headquarters with Jon Ransdell, McDonald’s Corporation, Kathleen Ford, Blue Martini, Vahe Katros, Blue Martini, Doug Jones, Target Corporation, Ron Kleinman, Sun Microsystems, John Fluke, IBM and Jerry Rightmer, 360 Commerce.
NRF and RAMA Take Retail Marketing to New Heights
t Education on the retail industry’s best practices supported by ARTS standards will be available in the Second Quarter of 2003. These classes will present technology solutions to retail business process problems that have been incorporated into the ARTS standards, and were based on thousands of hours of work contributed from a large number of premier global retailers and vendors.
RAMA celebrated the 50th year of the Retail Advertising Conference (RAC) with salutes to its many supporters who have helped build RAC into the premier marketing and advertising conference in the retail industry. The theme for this year’s milestone conference was “The Art of Storytelling” with the program focusing on the story of some successful brands. In 2002, RAMA formed a partnership with BIGresearch of Columbus, OH that will provide an important new benefit to RAMA members. The Consumer Intentions and Actions study provides fresh economic and consumer insights for RAMA members. This monthly newsletter summarizes data collected from at least 5,000 consumers and reports with keen foresight their intentions to purchase products from retailers and how they are spending and saving their money. As part of the agreement BIGresearch will also provide substantial discounts on its other services to RAMA members. RAMA President RAMA and NRF got new graphic looks in Tom Holliday speaks at RAC50 2002 with enhanced websites as well as updated NRF print materials. The new sites are much easier to navigate and will help RAMA focus its resources on important member services and benefits. RAMA and NRF also developed new organization logos with the help of industry partners. RAMA would like to thank all its partners for both in-kind and monetary contributions to the organization during the past year.
▼
The UnifiedPOS specification grew to more than 1,100 pages including chapters on implementing OPOS and JavaPOS. Today, UnifiedPOS fully satisfies the goal first conceptualized in 1998, “…freedom of choice in selecting POS devices…” and extended this vision by allowing retailers to use off-the-shelf PC’s as fully equipped sales floor terminals. The Data Model’s long awaited expansion from a single store to an enterprisewide operation was partially completed with an advanced pre-release distributed to the ARTS membership. Major international retailers demanded this extensive modification to enable use of this Model. The Model now supports separate pricing and merchandise allocation by an individual store or groups of stores across multiple divisions within one corporation. The Data Model conformance program was completed in 2002 and is now being used by vendors to verify that their applications are built on the Model. Retailers can now protect their investment by verifying responses to their RFP for Data Model compliance. International Expansion readily continued into 2002. ARTS presented at the International Association of Department Stores (IADS) CIO meeting in April, while attending the Global Retail Forum in Paris. In October El Corte Ingles co-hosted the annual European IXRetail meeting in Madrid. In London and Dusseldorf, well-attended education classes provided EMEA retailers and vendors the opportunity to learn more about ARTS standards and how to successfully implement them.
29
7 NRF Foundation NRF Foundation Offers Advanced Education and Training Services to Retail Industry
NRF BIG Show attendees took an active interest in many of the items being offered in the inaugural BIG Silent Auction, organized by the NRF Foundation to raise funds for Foundation education and career development programs. More than $45,000 in net proceeds was realized, due to generous donations from NRF members and Foundation supporters.
EARNING THE PIN
30
The Customer Service and Sales Skill Standards, developed with participation of more than 1,000 companies in retail and the service sector, were officially approved by the National Skill Standards Board, clearing the path for national assessment and certification.
▼
▼
NRF Foundation this year officially unveiled national certification in Professional Customer Service as part of the national system developed under the auspices of the National Skill Standards Board. In a pilot launch in May 2002, more than 800 individuals were provisionally certified, final analysis of the national assessment’s integrity was assured, and first-time ever industry-driven national certification was made widely available. Retailers, schools, and employment and training providers can now offer the assessment to potential and existing retail employees. Successful candidates are given, as part of their portfolio, a pin to demonstrate their level of mastery of skills necessary to demonstrate high performance in customer service. NRF Foundation is grateful to the hundreds of retail companies and individuals who have worked to ensure the validity and value of this new credential and are now helping to pioneer its use. Meanwhile, NRF Foundation is developing and testing the national assessment in sales, which is expected to be available in 2003. Other industries have taken note of the national standards and certification developed by the retail industry. Customer service and selling skills, learned in retail, translate and transfer to career options in a variety of occupations. NRF Foundation increasingly receives requests for assessment and certification from airlines, call centers, banks, hotels, delivery companies, and the armed services, among others.
Sales associates from the Philadelphia area complete the National Assessment in Customer Service at the Retail Skills Center at King of Prussia. More than 800 individuals participated in the pilot launch of the assessment and certification.
TURNING TURNOVER AROUND NRFF’s workforce development programs continued to broaden their scope and reach to help retail companies manage their employees’ professional development. Targeting post-secondary students, the newly enhanced NRF Foundation web site emphasizes career options and long-term advancement in retail. Trumpeting the message that retail is a career destination, this outreach is reinforced by the Foundation’s training and education programs. The former five active and successful Retail Skills Centers were joined this year by programs in Rochester, New York; Prince George’s County, Maryland; and San Marcos, Texas. Each site offers programs with a different twist, but all are built on the common purpose of recruiting, assessing talents and needs, providing personalized training, finding suitable job openings, followup and coaching for long-term success and productivity. Requests for new Retail Skills Centers and cross-industry skill development centers are fielded by NRF Foundation staff as word of this program’s
For more information visit www.nrf.com
The debut of Stocking the Shelves and Keeping Up Appearances marked completion of the full development of the Retailing Smarts series, a 12-volume series of user-friendly workbooks based on the industry skill standards in customer service and sales.
▼
agreed to participate in the January 2003 launch at NRF’s Annual Convention & EXPO. A number of retailers have also expressed interest in sharing content with other retail users through this venture. Additionally, an original series of courses leading to credentials is in the planning or development stages. Sponsors interested in participating are being sought, since their support will be critical to NRF’s ability to fully build out courses in multiple areas of operations—for employees and executives at all levels. SCANNING THE HORIZON
▼ Richard L. Sharp, Chairman and CEO, Circuit City Stores, Inc. and former Chairman of the NRF Board of Directors, presents the NRF Silver Plaque for outstanding service to NRF and the retail industry to Deborah Masten, Director of Human Resources, Communications and Development, J.C. Penney Company, Inc.
success travels. Partnerships with shopping center developers have expanded the potential for opening new centers where NRF Foundation is effectively brokering partnerships among employers, government, educators and community organizations. NRF UNIVERSITY NRF Foundation’s partnership with Sun Microsystems to create and roll out an industry-wide, web-delivered program of education and professional training was announced in January 2002. Labeled NRF University wired, the initiative will enable retailers, educators, trainers and others to access courses in virtually every retail discipline from a growing number of sites, providing opportunities for professional development in and around the workplace. Throughout 2002, course offerings were solicited from educational content providers and peer reviewed to ensure that offerings for the university were of the highest quality and retail specific. Seven initial content partners have
NRF Foundation worked closely with sponsor and partner BearingPoint (formerly KPMG Consulting) this year to make good on its promise to deliver a definitive state of the industry report by January 2003. Retail Horizons: Benchmarks 2002, Forecasts 2003, gathered data on measures in key retail areas from supply chain to human resources, nine in all. The metrics were supported with face-to-face interviews with C-level executives across the retail spectrum in order to ensure the benchmarks and forecasts were truly representative of the entire retail industry. Findings and strategy recommendations will be released in a Super Session at NRF’s Annual Convention & EXPO in January 2003. Copies of the study will also be available from the NRF Foundation for purchase through the NRF Bookstore. INVESTING IN THE FUTURE Retailers, suppliers and business partners, NRF staff members and friends of NRF Foundation got in on the fun of the first Retail’s BIG Silent Auction, held over a three-day period in conjunction with the NRF Annual Convention & EXPO. Sponsored by JDA Software and co-chaired by James M. Zimmerman, Chairman and CEO, Federated Department Stores, Inc., and Robert J. Corliss, Chairman and CEO, The Athlete’s Foot Group, the auction offered unique and interesting items that sometimes sparked lively bidding and resulted in net proceeds of more than $45,000 to support Foundation initiatives. Building on this success, the second annual event is underway to be held in conjunction with the 2003 NRF Annual Convention. It is on track to far exceed the success of the inaugural event and turn this into the NRF Foundation’s major fundraising event each year. 31
8 STORES Magazine STORES Magazine Keeps NRF Members Informed One of several results of 2002’s soft economy was that retailers worldwide began placing an even higher level of scrutiny on their operations expenditures. As a result, increasing numbers of merchants are turning to STORES. The STORES editorial staff also helped meet the need for integral IT information with the launch of two new publications, the STORES Software Sourcebook and the STORES Retail Deals e-newsletter. Launched in May 2002, the Software Sourcebook tees off the fact that retailers increasingly rely on a variety of software applications to help achieve optimum operational efficiency. This annual publication is designed to help retailers of all sizes and in all industry segments find the software applications needed to run a successful enterprise. The Retail Deals e-newsletter is a bi-weekly publication designed to keep retailers and product and service providers abreast of the latest IT developments, including new hardware and software applications, retail implementations worldwide, personnel changes, and other important retail IT information. Both the Software Sourcebook and the Retail Deals e-newsletter join STORES growing stable of publications, including STORES Magazine, STORES Online, the STORES Retail Industry Buying Guide, the annual Retail Industry Calendar, the Top 100 Retailers and Top 100 Specialty Stores lists, and the Top 200 Global Retailers list.
During 2002, STORES maintained its No. 1 position as the best-read and best-rated magazine for senior retail executives in all industry segments. An industrywide survey of retail executives found that: " 56 percent of executives, if limited to receiving one publication, would choose to receive STORES " 45 percent say STORES provides the best information on supply chain, logistics and warehousing " 46 percent rate STORES as providing the best information on computer software, hardware and point of sale " 53 percent believe STORES provides the best information on credit, collections and payment systems " 62 percent have recommended the purchase of equipment, products or services advertised in STORES " 81 percent of executives have discussed with a colleague a product or service advertised in STORES.
32
9
Financials SOURCE OF FUNDS
Your Dues $ Hard at Work: NRF members receive over $3 in products and services for every $1 of dues paid. NRF member benefits include advocacy, knowledge exchange, education and community building. STORES magazine, Retail's Big Show and other NRF conferences provide significant resources to underwrite NRF member benefits.
Convention & Conferences 43%
NRF STORES Magazine 20%
Program Revenue 7% Member Dues 19% Miscellaneous 11%
USE OF FUNDS
Advocacy, Member Programs and Administration 63%
STORES Magazine 17%
Convention & Conferences 20%
THE NATIONAL RETAIL FEDERATION
is the
retail industry’s largest advocacy organization, advancing the industry
through
publications
and
professional educational
seminars, activities
trade and
conferences,
influencing
the
development and content of legislation and public policy affecting retailing and the consumer. By bringing under the Federation umbrella 36 national associations that have members in most lines of retailing, associations in all 50 states and the District of Columbia, and 36 international associations representing retailers abroad, NRF represents an
325 7th Street, NW Suite 1100 Washington, DC 20004
industry which encompasses more than 1.4 million U.S. retail establishments, employs more than 20 million Americans —
(202) 783-7971
about 1 in 5 U.S. workers — and registered sales of nearly $3.5 trillion in 2001. NRF also has a sizable international membership of more than 1,000 stores in 50 nations abroad.
Fax: (202) 737-2849 www.nrf.com