CELEBRATING
100 YEARS OF LEADERSHIP
325 7th Street NW, Suite 1100, Washington, DC 20004 (202) 783-7971 Fax (202) 737-2849 www.nrf.com
2011 ANNUAL REPORT
COVER PHOTOS (clockwise from upper left corner): Tory A. Burch, Founder and Creative Director, Tory Burch Allen Questrom, former CEO, JCPenney and Federated Department Stores Roger Farah, President and CEO, Polo Ralph Lauren House Speaker, John Boehner (R-OH) Kip Tindell, Chairman and CEO, Container Store and Tony Hsieh, CEO, Zappos U.S. Senator Mitch McConnell (R-KY), Senate Republican Leader Stephen Sadove, Chairman and CEO, Saks Inc. Bert Jacobs, Founder, Life is Good Mindy Grossman, CEO, HSN U.S. Representative James Clyburn (D-SC), Assistant Democratic Leader U.S. Senator Dick Durbin (D-IL), Democratic Whip Terry Lundgren, Chairman, President and CEO, Macy’s, Inc. and Chairman, National Retail Federation and Matthew Shay, President and CEO, National Retail Federation
NRF 100
Mission Statement NRF’s mission is to advance the interests of the retail industry through advocacy, communications and education. As the world’s largest retail trade association and the voice of retail worldwide, the National Retail Federation’s global membership includes retailers of all sizes, formats and channels of distribution as well as chain restaurants and industry partners from the U.S. and more than 45 countries abroad. In the U.S., NRF represents the breadth and diversity of an industry with more than 1.6 million American companies that employ nearly 25 million workers and generated 2009 sales of $2.3 trillion.
Contents 2 Chairman’s Message 3 President’s Letter 4 Introduction 2010 6 Officers and Board of Directors
8 ADVOCACY 8 Government Relations 12 National Council of Chain Restaurants
14 COMMUNICATIONS 14 Media Relations 15 Washington Retail Insight Newsletter 18 STORES Media
20 EDUCATION 20 99th Annual Convention and EXPO 22 Shop.org’s Annual Summit 23 Loss Prevention Conference and EXPO 24 Innovate ’10 26 Research
28 COMMUNITIES 28 eCommerce 30 Marketing 32 Loss Prevention 34 Information Technology 36 Sustainability 37 Supply Chain 38 Finance 39 Legal
40 NRF FOUNDATION 42 ADVISORY BOARDS, COUNCILS AND COMMITTEES 48 FINANCIAL OVERVIEW
ADVOCACY
Chairman’s Message
F
ollowing one of the most challenging periods in the retail industry since perhaps the 1930s, 2010 was a year of gradual recovery.
Sales haven’t completely returned to levels seen before the “great recession” of 2008 and 2009, however, there is no question that the industry is in much better shape. Retailers saw increases in key discretionary spending categories, and while improvement in economic indicators such as employment, consumer confidence and GDP are needed to sustain any long-term growth, the momentum appears positive as we head into 2011. Consumers are still cautious, but optimism is rising and purse-strings are loosening. The recent economy has forced retailers to think differently and do business differently. We’ve had to better manage our inventories, create better value at every price point, and make every aspect of our operations more efficient. Looking back, many NRF members viewed the recession as a call-to-action to make aggressive changes to make their business model more efficient and more responsive to consumer demand. It was exciting for me to become chairman of the National Retail Federation during such a pivotal time, and to have the opportunity to work with some of the best and brightest from other companies to seek solutions to help restore the vitality not just of our industry but of our nation’s economy. With its diversity of membership and wide variety of conferences, networking opportunities, committees and other resources, NRF provides a forum for advocacy, communications and education where retailers working together can achieve far more than any of us could on our own. Unity of the retail industry was particularly important in Washington in 2010, with almost every critical issue tied to the economy and jobs. Retailers saw a major victory on debit and credit card swipe fees, pushed back proposals for a Value Added Tax that would have thrown away hundreds of thousands of jobs, and were able to defeat key provisions of the job-taxing new health care reform law that would have made the measure even more draconian. We also made progress on issues such as organized crime against retail and gift cards, just to name a couple. Amid all of these developments, the past year was a time of change at NRF. We introduced a new President and CEO as Matthew Shay succeeded Tracy Mullin, who served NRF with distinction for 34 years. With roots in retail and a strong track record of association management and advocacy success, Matthew has shown tremendous leadership, energy and enthusiasm that will guide our organization confidently into the future. I’m looking forward to working with Matthew, his team and our membership so that NRF continues to make progress and represent our membership effectively in 2011 and beyond.
Terry J. Lundgren Chairman, President and CEO Macy’s, Inc.
2
National Retail Federation
2010 Annual Report
President’s Letter
N
o matter your size, category or channel, the great recession of recent years left no retailer untouched. Inventories were slashed, jobs were lost and companies faced tough times as they were forced to make even tougher decisions.
As 2010 began, however, hints of optimism emerged and retailers started to show they were finally ready to turn the page on a dismal period. The industry’s response to this time of crisis was an inspirational show of innovation. Proving that every economic downturn is ripe with opportunity, retailers found new ways to embrace their customers through social media. Industry leaders streamlined operating costs with a very fluid supply chain. When many were competing on price, smart retailers stood out by offering private label brands and investing in localization efforts. When the road ahead becomes uncertain, retailers do what they do best - adapt, transform and thrive. NRF has followed our members’ fine example. 2010 was a year of transformation for NRF. With uncertainty in the economy and Capitol Hill becoming the new normal, it was important for NRF to look inward to make sure our resources were aligned with our mission. We developed a new strategic plan based on a perception audit of our members and policymakers, designed to gauge their opinions of NRF and the role we play within the industry. This plan will sharpen our focus as we invest in new resources to support advocacy, education and communications. Investments are already paying off. NRF secured a major legislative win with passage of credit/debit card swipe fee reform, successfully fought back the first round of proposals to create a Value Added Tax, and negotiated with Congress and the Administration to make the new health care reform law as workable as possible. Victories like these are excellent examples of what the industry can accomplish when it comes together on key issues. And while we have achieved some major wins, the real work is just beginning. Looking ahead, NRF will capitalize on all opportunities to work with Congress to influence and support policies that will help the business community thrive and create jobs. Many members are poised for substantial productivity gains in 2011, but a great deal of work still needs to be done to foster more stability for the economy. The retail industry will play a key role in this economic recovery and we plan to make sure that our industry has a seat at the table for all major economic policy discussions. As we raise the curtain on 2011, NRF looks forward to commemorating 100 years of representing an industry with a rich history and proud tradition of excellence. Working together we will ensure our industry’s continued success as we embark on the next 100 years. Thank you for your continued support and we look forward to serving your needs in the coming year.
Matthew Shay President & CEO National Retail Federation
100 Years of Leadership
www.nrf.com
3
NRF 100
INTRODUCTION
The Voice of Retail Worldwide The Road to Economic Recovery Runs Through Retail No other industry has the ability to impact our economy quite like retail. And with that, our industry has been on the forefront of the economic recovery. With retailers creating jobs for one in five American workers and consumer spending accounting for two-thirds of U.S. gross domestic product, it is no wonder why all eyes have been fixed on the performance of the retail industry. No other industry has a larger economic footprint and no other industry is closer to the consumer. With an overwhelmingly influential impact on the most predominant issues facing our country and governments across the globe, it’s paramount for our membership to have a voice in policy decisions. And every voice should be heard.
NRF Membership NRF is proud to represent the full breadth and depth of retailing, from independent retailers to grocers, multi-national companies and online retailers. In 2010, our members sought NRF information, guidance and perspective through the Federation’s original research and consumer trend information, participation in NRF committees and councils, and NRF’s representation before Congress. NRF responded by providing its members with cost-effective ways to instantly access industry data, resources, and networking opportunities—all the while delivering worldclass advocacy on issues that matter most.
Appealing to All Sizes and Sectors With the economic downturn in our rearview mirror, membership has come roaring back in 2010. Many wellknown brands returned as NRF members, including: • Benetton USA • Crabtree & Evelyn, Ltd. • ESCADA of the Americas • iParty Corporation • Party City Corporation • Pier 1 Imports, Inc. • Stuart Weitzman • Ulta Salon, Cosmetics & Fragrance, Inc. • Urban Brands, Inc. 4
National Retail Federation
2010 Annual Report
Retailers who had never been members made the decision to invest in their future by joining NRF this past year, including: • Academy Sports + Outdoors • David’s Bridal • Godfather’s Pizza, Inc. • Grupo Coban S.A. (Guatemala) • OfficeMax • Otto Group (Germany) • Sony Corporation of America • Tuesday Morning, Inc. • Under Armour, Inc. • Williams-Sonoma, Inc. In total, more than 200 companies joined NRF as direct members in 2010. As NRF enters 2011, the future looks bright for new member acquisition as well as member retention. In fact, in a survey of NRF members, 90 percent of respondents stated that they would renew their membership while 80 percent said they would recommend NRF membership to others.
Thinking Globally – Acting Locally NRF’s membership includes “affiliate” relationships with such groups as the Travel Goods Association. In 2010, NRF launched a new affiliate program called the State Leadership Group. The program is designed to increase cooperation between NRF and state retail associations on advocacy efforts. The SLG now comprises 19 state associations and resulted in NRF’s membership rolls swelling to more than 6,000 direct or affiliated company members in 2010.
Influencing Retailing Around the World Nearly 20 percent of NRF members are based outside of the United States. As globalization continues to provide growth opportunities for U.S.-based retailers as well as international retailers seeking to move into emerging markets, it becomes increasingly important for NRF to expand its global footprint. In 2010, NRF or its divisions sponsored or presented at a number of global events, including: • POPAI Italia • China Department Store Summit
Advancing the interests of our membership With NRF working to advance the interests of the retail industry at both the state and national levels – the range of issues to be addressed is enormous. NRF is the only retail trade association with the depth and breadth of membership to truly speak for the entire industry at once. That ability is crucial in Washington, where decisions impacting retailers on issues as varied as tax policy, job creation, health care, labor relations and international trade are made every year. As the leader of the retail industry’s advocacy efforts, NRF is well known as “The Voice of Retail on Capitol Hill.” No matter what the forum or venue, retailers can rest assured that NRF will see that their voices are heard.
NRF and the NRF Foundation participate in a panel discussion about customer service standards for China retail, which took place at the Beijing Technology & Business University. Pictured are (from right): Kimberly Grabel (Saks Fifth Avenue); Katherine Mance (NRF Foundation); Denise Brassé (NRF); Rick Philips (Castle Worldwide); Xiuqi Chu, Chairman, China Commerce Association for General Merchandise.
• RAC Lite (South Africa) • Retail Days (Turkey) • European Retail Technology Summit (Netherlands) • World Retail Congress (Germany) • International Retail Design Conference (Canada)
2010 Membership Composition Membership Composition
2010 2009 2008
In addition to speaking events, NRF continues to serve as Secretariat for the Forum for International Retail Association Executives. Today, 24 of NRF’s counterparts around the world contribute to FIRAE and its website, www.firae.org.
Leveraging Expertise to Create New Tools for Members Capitalizing on its cumulative experience, the NRF Associate Member Advisory Council (AMAC) created two new member benefits in 2010: • Buddy Program: AMAC members call new associate members within 60 days of joining to ensure that members are aware of resources available to them through their NRF membership and to offer peer-to-peer assistance as needed throughout the year. • Roadmap to Retail’s BIG Show: A compilation of how-to’s and what-not-to-do’s at NRF’s Annual Convention & EXPO, written by AMAC members who have experience exhibiting and/or attending.
Disseminating Information on Retail Best Practices AMAC’s mission is to provide feedback to NRF regarding the needs of their own customers — the retail industry — and how NRF can better meet those needs. AMAC also serves to ensure the needs of NRF’s associate member base are met. Information is disseminated to the full associate membership via blog postings and at the annual “Town Hall” meeting held in conjunction with the NRF Annual Convention.
US Retailers
2007
International Retailers Non-Retail Members
2006
Affiliated Members
2005 0
1000
2000
3000
4000
5000
6000
7000
2010 Global Retail Membership by Annual Sales $500 million to $1 billion 8%
$1 to $5 billion 14%
Over $5 billion 8%
$100 to $500 million 16%
Up to $1 million 26%
$50 to $100 million 5% $10 to $50 million 9%
$1 to $10 million 14%
2010 International Retail Member Distribution Canada 32% Caribbean & Latin America 15%
Europe 22% Middle East & Africa 15%
Asia-Pacific 13%
100 Years of Leadership
www.nrf.com
5
2010 OFFICERS Chairman of the Board and Chairman of the Executive Committee
Terry J. Lundgren Chairman, President and CEO Macy’s, Inc.
First Vice Chairman
Stephen I. Sadove Chairman and CEO Saks Incorporated
Second Vice Chairman Chairman of the Awards and Nominations Committee Chairman of the NRF Foundation
Kip Tindell Chairman and CEO The Container Store
Chairman of the NRF Finance Committee
Roger N. Farah President and COO Polo Ralph Lauren Corporation
BOARD OF DIRECTORS Marty P. Albertson Chairman Guitar Center, Inc.
Claudio Del Vecchio Chairman and CEO Retail Brand Alliance, Inc.
Thomas G. Bata Jr. Chairman BataCorp SA
Brian K. Devine Chairman PETCO Animal Supplies, Inc.
H. James Baum CEO BGH “Here’s Hallmark” Shops
William Dombrowski President California Retailers Association
Robert M. Beall II Chairman Beall’s, Inc. Artem A. Bektemirov CEO Pharmacy Chain 36.6 Byron L. Bergren President and CEO The Bon-Ton Stores, Inc.
Joe Flannery President Weaver’s, Inc. Philip L. Francis Executive Chairman PetSmart, Inc. Mindy F. Grossman President and CEO HSN
Cem Boyner Vice Chairman and CEO Boyner Holding A.S.
6
National Retail Federation
2010 Annual Report
Philippe Houzé Chairman of the Executive Board Galeries Lafayette Elliot S. Jaffe Chairman and Founder The Dress Barn, Inc. John Karonis President, Retail and Consumer Products Group Kurt Salmon Associates, Inc. M. Farooq Kathwari Chairman, President and CEO Ethan Allen Interiors Inc. Daniel S.C. Koo Chairman Shui Hing (HK) Limited Kay Lawther Krill President and CEO Ann Taylor Stores Corporation
Keith Lipert President Keith Lipert Gallery Jon L. Luther Chairman Dunkin’ Brands Lovro Mandac CEO Kaufhof Warenhaus AG William L. McComb CEO Liz Claiborne Inc. Chris McCormick President and CEO L. L. Bean, Inc. Mitchell B. Modell CEO Modell’s Sporting Goods
Steve Sadove Chairman and CEO Saks Incorporated (Member Since 1948)
President and CEO
Corporate Secretary
Matthew Shay President and CEO National Retail Federation
Robert M. Benham President and CEO Balliet’s LLC
Jorge Pont Assistant to the Chairman, Sr. Director, International Affairs El Corte Inglés, S.A.
Edward W. Stack Chairman and CEO Dick’s Sporting Goods, Inc.
Daryl Routzahn President and CEO Routzahn’s Matthew E. Rubel President and CEO Collective Brands Inc. Ron Sacino President and CEO Sacino’s Formalwear Lori Schafer Executive Director SAS Institute Gordon I. Segal Chairman Crate & Barrel
J. Hill Stockton President and CEO Norman Stockton, Inc. Trudy F. Sullivan President & CEO The Talbots, Inc. Burton M. Tansky President and CEO The Neiman Marcus Group, Inc.
The NRF played a leading role in ensuring that the issue of credit card fee reform received appropriate consideration on Capitol Hill, in the White House and before federal agencies. Its voice is loud, clear and authoritative, and meaningfully contributed to what we expect is the start of a paradigm shift for retailers.
James F. Wright Chairman & CEO Tractor Supply Company Arnold B. Zetcher Chairman and CEO, Retired, The Talbots, Inc.
Terry J. Lundgren Chairman, President and CEO Macy’s, Inc. (Member Since 1934)
The unique proposition of the National Retail Federation is that we represent such a broad range of retail companies, from family owned, single store retailers to companies like Macy’s and Bloomingdale’s with hundreds of stores and hundreds of thousands of employees. We have the potential to deliver a very powerful message when our collective voice is heard and understood. Our industry represents one in five jobs in America so if there is going to be job recovery in America it is likely that NRF will be a major participant. Not many associations can make that claim.
100 Years of Leadership
www.nrf.com
7
NRF 100
ADVOCACY
Government Relations NRF Continues as ‘The Voice of Retail on Capitol Hill’ Washington policymakers have long considered NRF “The Voice of Retail on Capitol Hill” because of our broad expertise on public policy issues and the diversity of our membership from Main Street stores to iconic national brands to online merchants exploring the latest frontiers of e-commerce. In a year focused so intently on the economy and job creation, top members of the House, Senate and officials from the Administration recognized that the road to recovery runs through retail, and met with NRF to discuss ways in which the public and private sectors can work together to get America back on its feet. House Speaker John Boehner (R-OH), Senate Minority Leader Mitch McConnell (R-KY), Senate Majority Whip Dick Durbin (D-IL), U.S. Trade Representative Ron Kirk, Federal Trade Commission Chairman Jonathan Leibowitz and White House Domestic Policy Council Director Melody Barnes were among just a few of the top-level officials to participate in NRF events. NRF repeatedly put CEOs and senior executives of member companies face to face with these and other Washington decision-makers to demonstrate retail’s importance to the nation’s economy and convey our industry’s positions on issues that affect our companies, employees and customers. NRF was a major participant when Boehner held a forum on job creation at the U.S. Capitol, and NRF’s National Council of
CEOs of top brands gather on Capitol Hill: Ron Sacino of Sacino’s Formalwear, Gordon Segal of Crate & Barrel, Terry Lundgren of Macy’s Inc. and John Luther of Dunkin’ Brands.
8
National Retail Federation
2010 Annual Report
Chain Restaurants division took CEOs to the White House to discuss concerns about the new health care reform law. The economy is always on the agenda when NRF lobbies Congress and the Administration on dozens of public policy issues each year. But seldom has job creation been as integral to so many issues as it was during 2010. NRF is continually working to ensure that retail’s advocacy footprint matches our industry’s economic footprint.
Major Win on Credit/Debit Card Swipe Fees After five years of advocacy and communications efforts by NRF that raised the issue of interchange fees charged to merchants by Visa and MasterCard banks from obscurity to a major public policy debate, Congress passed legislation requiring the Federal Reserve mandate “reasonable and proportional” debit card fees as part of the Dodd-Frank Wall Street Reform Act of 2010. NRF is arguing that the fees should be near zero since debit cards are really electronic checks and paper checks drawn on the same bank accounts are cashed at face value. The legislation also allows retailers to give discounts to customers who pay by cash, check or debit, helping reduce the number of transactions conducted on credit cards, which can carry fees as high as 3 percent. Merchants are also now allowed to set a minimum purchase price of up to $10 for credit cards, helping steer purchases to lower-cost forms of payment. Despite massive lobbying by the banking industry, NRF is continuing to push for legislation that will require the card industry to negotiate over credit card swipe fees.
Maryland Retailers Association President Tom Saquella holds the NRF J. Thomas Weyant Lifetime Achievement Award. With Saquella are Representative John Sarbanes, D-MD, and Donna Edwards, D-MD.
Senate Minority Leader Mitch McConnell speaks during the NRF Board’s summer meeting in Washington.
Job Killing Value Added Tax Defeated – For Now With the federal deficit at record levels and growing, a number of Washington policymakers proposed the creation of a European-style Value Added Tax as a way to generate additional revenue and bring the deficit under control. NRF warned lawmakers that such a move would threaten the nation’s already fragile economic recovery because the higher retail prices that would come with a VAT would cause consumer spending to plummet, taking jobs and gross domestic product along with it. NRF commissioned Ernst & Young to conduct a macroeconomic analysis, and their study found a VAT would cause the loss of 850,000 jobs in the first year, reduce GDP for three years and cause a $2.5 trillion drop in spending over the first 10 years. NRF wants the deficit reduced, but believes spending cuts and initiatives that put Americans back to work are the better solution. President Obama’s deficit reduction commission came to largely the same conclusion, and left a VAT out of its report issued at the end of the year. But the issue is expected to return during the 2011-2012 session of Congress, and NRF will continue to fight its enactment.
NRF Leads Fight for Positive Health Care Reform Now that the Patient Protection and Affordable Care Act of 2010 is the law of the land, NRF is working to roll back some of the measure’s most burdensome provisions and to help retailers work as efficiently as possible within the restrictions that remain. In one early victory, NRF helped convince the Obama Administration to give a one-year reprieve to “minimed” plans that otherwise could have been shut down in 2011. The plans offer low, affordable rates and are widely used by a number of retailers and restaurants.
and small business owners to Capitol Hill, and drafted the retail industry’s Vision for Health Care Reform to demonstrate how coverage could be made more accessible by making it more affordable. NRF achieved great successes with many lawmakers, was able to defeat a number of negative provisions, and prevented far more draconian legislation from being passed. The Administration nonetheless ultimately developed a measure that focused on employer mandates, with huge penalties for companies that don’t comply. With penalties based on the number of workers who don’t receive government-mandated levels of coverage, NRF is concerned that the new law amounts to a tax on jobs. Unable to absorb the cost of either mandate coverage or penalties in the Elisa D. Garcia Executive Vice President & General Counsel Office Depot, Inc. (Member Since 2001)
NRF serves so many purposes for Office Depot. It keeps us informed of legislative threats, seeks our input and formulates a strategy to educate legislators, retailers and the public on issues that affect our businesses. Through the NRF General Counsels Forum our lawyers share information on many day-to-day issues, which saves us time and money (We never have to reinvent the wheel--with the diversity of participants, there is always another member that has faced the problem du jour.). The GC Forum also took a leadership role in educating retailers and regulators about the anticompetitive effects of interchange fees.
During the two-year debate that culminated in passage of the controversial health care bill, NRF repeatedly brought CEOs
Politico newspaper co-founder and Executive Editor Jim VandeHei speaks at the NRF summer Board meeting in Washington. Listening at right is NRF President and CEO Matthew Shay.
Senator Ben Nelson (D-NE) speaks at NRF’s Washington Leadership Conference.
Robert Benham, CEO, Balliet’s at the NRF Board Meeting.
House Select Revenue Measures Subcommittee Chairman Richard Neal (D-MA) listens to questions during NRF’s summer Board meeting in Washington. 100 Years of Leadership
www.nrf.com
9
NRF 100
ADVOCACY
current economy, many retailers say they will be forced to lay off workers in order to provide coverage for a smaller staff. Indeed, some small retailers say they could be forced to abandon plans to grow rather than hit the 50-worker threshold for being covered by the law. NRF is continuing to press the White House and Congress to address those concerns.
Broadened FTC Authority Kept Out of Wall Street Bill NRF helped defeat plans to include a major expansion of Federal Trade Commission authority in the Dodd-Frank Wall Street Reform Act, arguing that the proposal could have led to a broad range of regulations that would hinder job creation. While NRF has supported reasonable regulations in the past, the Dodd-Frank proposal would have given the FTC unlimited power to both set and enforce regulations under its broad mandate of preventing “unfair and deceptive trade practices,” and the commission would have received new power to bring lawsuits on its own. A provision giving the commission power to take action against those who “aid and abet” violations could have seen retailers caught up in enforcement actions even if they had no knowledge of alleged wrongdoing. Kip Tindell Chairman and CEO The Container Store (Member Since 1997)
NRF is an invaluable source of support and resources for every area of our business. Over the past year alone, they have guided us through complicated health care legislation, shared loss prevention trends, helped us to navigate the ever-changing world of accounting and tax rule-making and served as a strong voice for retailers on Capitol Hill. Whether it’s through Board-related activities, Executive Council meetings or networking events with peer retailers, we walk away from every NRF event with valuable takeaways that help drive our business.
Main Street Fairness Act Would Close Internet Sales Tax Loophole An updated version of NRF-backed legislation making it easier for states to require Internet retailers to collect sales tax was reintroduced as more state officials from across the country called on Congress to close the loophole that allows many online sales to go untaxed. NRF believes all retailers should play by the same tax rules, and argued that collecting sales tax on Internet purchases would keep cash-strapped state governments from increasing other taxes to make up for the lost revenue. 10
National Retail Federation
2010 Annual Report
Estate Tax Could Finally See Long-Term Solution With high federal estate taxes historically a major obstacle to passing down family-owned retail businesses from one generation to the next, NRF was a prime supporter of 2001 legislation that phased out the tax and eliminated it entirely as of 2010. Unfortunately, the phase-out was temporary, and the tax was scheduled to return to its previous level of a whopping 55 percent on estates of $1 million or more in 2011. The situation made estate planning a nightmare, and NRF lobbied for a permanent solution. At the end of 2010, Congress approved and President Obama signed into law a proposal that will set more reasonable rates in 2011 that will give family-owned retailers the certainty they need in making plans to hand down their businesses. But the deal is good for only two years, leaving Congress to still find a permanent solution.
Organized Retail Crime Gets Federal Attention NRF has long led the retail industry’s fight against the $30 billion-a-year problem of organized retail crime, and in 2010 convinced the House to pass legislation creating an ORC unit at the Department of Justice. Staffed by DOJ prosecutors along with FBI, Secret Service, customs and immigration agents, and postal inspectors, the team will be charged with investigating and prosecuting ORC incidents, assisting state and local law enforcement, and advising victims of ORC. The legislation also defines ORC, and directs the Attorney General to submit a report on how retailers, online businesses and police can help prevent such crimes. Senate approval is still needed.
Retailers Win Grace Period on Gift Card Disclosures Congress gave retailers a grace period until February 2011 to make sure all gift cards carry a printed notice of any expiration date or inactivity fees as required under the 2009 Credit CARD Act. The move came after NRF explained that retailers could not easily get alreadyprinted cards off store shelves by the original August 2010 deadline. In another development, NRF is fighting a Treasury Department proposal to place gift cards under antiterrorism laws and require retailers to track sales, collect customers’ names and file “suspicious activity” reports when cards are sold in large quantities or for large dollar values. The vaguely written proposal could require tracking of multiple small transactions in case they add up to “suspicious” levels.
Fight Continues Over Chinese Imports NRF is continuing to fight protectionist efforts to impose stronger tariffs and duties on merchandise imported from China. Protectionists’ latest effort would pressure China to let its currency float more freely against the dollar by requiring the Commerce Department to consider whether the currency is undervalued when considering “countervailing” duty cases. If so, higher duties
GOVERNMENT RELATIONS would be imposed. NRF has argued that the proposal violates international trade rules and could subject U.S. exports to retaliation while doing nothing to protect or preserve U.S. jobs because most merchandise in question is no longer made in the United States in commercial quantities.
Bill to Expand Lawsuits Defeated NRF helped defeat legislation that would have exposed retailers to more lawsuits over claims of gender discrimination in hiring, promotion or pay while making it more difficult to defend themselves. The Senate in November rejected the Paycheck Fairness Act, which had already passed the House and was expected to be signed by President Obama. With Republicans in control of the House in 2011 and Democrats’ majority narrowed in the Senate, the bill is not expected to be revived in the next two years. The decisive vote came after NRF delivered hundreds of calls and emails to Senate offices from retailers concerned the bill would encourage litigation at the expense of economic certainty and job creation. Retailers oppose discrimination of all types, but told senators the Equal Pay Act and Civil Rights Act already provide strong protections.
House Select Revenue Measures Subcommittee Chairman Richard Neal (D-MA), left, speaks with NRF Senior Vice President for Government Relations Steve Pfister, center, and Terry Lundgren of Macy’s at the U.S. Capitol during NRF’s summer Board meeting. Marty Albertson of Guitar Center, left, speaks with Terry Lundgren of Macy’s, center, and Steve Sadove of Saks during NRF’s summer Board meeting in Washington.
Most Retailers Exempted from ‘Red Flag’ ID theft Rule Retailers will be subject to the Federal Trade Commission’s “Red Flags” identity theft rule only if they actually pull credit reports, thanks to legislation passed by the House and Senate. The original rule was developed to implement a provision in the Fair and Accurate Credit Transactions Act of 2003 requiring creditors to develop procedures to prevent identity theft. But the rule defined “creditor” so broadly retailers would have been required to comply even if all they did was help customers fill out applications for private-label credit cards. NRF argued that all actual credit decisions for such cards are made by the third-party banks that issue the cards, and that retailers would have been subject to compliance burdens and potential penalties. Even the FTC agreed that the definition of creditor was too broad, and held off enforcement for more than two years until legislation narrowing the Red Flag Program Clarification Act of 2010 was passed in December 2010.
Senator Judd Gregg (R-NH), left, speaks during a meeting with the NRF Board at the U.S. Capitol. Listening from left are Terry Lundgren of Macy’s and NRF President and CEO Matthew Shay.
2011 and Beyond In the world of Washington politics, most issues evolve slowly, and even what appears to be the resolution of an issue is not always final. Many of the bills and initiatives discussed above will continue to be debated during the 2011-2012 session of Congress, if not beyond. But merchants can rest assured that NRF will continue to use advocacy, communications and education to see that the voice of retail continues to be heard on Capitol Hill.
The NRF Board of Directors holds its annual summer meeting at NRF headquarters in Washington.
100 Years of Leadership
www.nrf.com
11
NRF 100
ADVOCACY
NCCR Provides Leadership to Chain Restaurant Industry The National Council of Chain Restaurants is the national trade association exclusively representing the chain restaurant industry and has worked for more than four decades to provide leadership to the industry by advancing sound public policy for its members. NCCR conducted its second highly successful Chain Restaurant CEO Policy Summit in Washington in September. Eighteen CEOs participated and discussed major public policy issues with House Speaker John Boehner (R-OH), Senator Lamar Alexander (R-TN), U.S. Trade Representative Ron Kirk, and White House Domestic Policy Director Melody Barnes.
NCCR Public Policy Leadership In 2010 NCCR provided leadership on critical public policy issues impacting the industry, including: • Food safety • Federal menu labeling • Commodity prices • Health care reform • Small business access to capital • Employment policy
NCCR is leading the industry in working with federal regulators to ensure that new federal menu labeling requirements passed under the health care reform law are satisfactory for chain restaurants. NCCR created a working group of chain restaurant companies to collaborate on a unified position on the best outcome for regulations being developed to implement labeling requirements, meeting regularly with policymakers at the Food and Drug Administration and elsewhere in the administration to ensure the industry’s voice is heard. NCCR also assisted members in ramping up grassroots interaction with lawmakers to its highest level ever. And NCCR continued to represent the chains in the courts by filing briefs in a number of cases involving tax issues, the tip credit, employee compensation and other issues, all of which would have significant consequences for the industry
Mike Starnes Vice President, Brand Protection, Quality & Regulatory Compliance Denny’s Inc. (Member Since 2005)
NRF has demonstrated over the years, with its large and diverse membership, its commitment to proactively get involved and ensure that our voices are heard on “the Hill.” Denny’s has benefited from NRF’s influence and effectiveness as a trade group, their timely information, wealth of resources and insights that are essential to our business.
Steve Davis, CEO of Bob Evans Farms, discusses public policy issues with other chain restaurant CEOs during NCCR’s Second Annual Chain Restaurant CEO Policy Summit. NCCR Vice President, Scott Vinson, presented Mike Kull, President, Dairy Queen Corporate Stores, International Dairy Queen, with the NCCR Award for Grassroots Excellence during the NCCR Annual Meeting dinner. One of the highlights of NCCR’s Chain Restaurant CEO Policy Summit were comments from House Speaker John Boehner (R-OH).
12
National Retail Federation
2010 Annual Report
GOVERNMENT RELATIONS NRF Board discusses jobs and the economy with lawmakers at annual CEO Summit One of the most important roles of the NRF Board of Directors is to set priorities and develop strategy on public policy issues affecting the retail industry. This responsibility is never more evident than during the Board’s summer meeting each year in Washington, where CEOs from some of the nation’s most prominent retailers sit down face-to-face with a number of our nation’s most influential lawmakers. Job creation, proposals for a national value added tax, and rising credit and debit card “swipe” fees were among the issues discussed with members of the House and Senate at 2010’s CEO Washington Summit. Board members met at the U.S. Capitol with Senate Majority Whip Dick Durbin (D-IL), Minority Leader Mitch McConnell (R-KY), and Senator Judd Gregg (R-NH), The House was represented by Representative Richard Neal (D-MA), chairman of the Ways and Means Committee’s “Select Revenue Measures” subcommittee, which originates most of the nation’s tax laws. CEOs told lawmakers that job growth is the top priority in restoring consumer confidence as the nation’s economy struggles to recover, not just within the retail industry but in other sectors that employ retailers’ customers as well. Board members said uncertainty over tax policy – such as the pending expiration of Bush-era tax cuts at the end of the year, lack of a permanent estate tax solution and failure to renew real estate depreciation rules that play a role in whether to remodel stores – makes it difficult for retailers to move forward on hiring. They also expressed concern about initiatives that discourage job creation such as the employer mandate provisions of the health care reform law. Members emphasized the need for tax policy that frees up capital and other steps to make credit more available so more companies, especially small businesses, can play a role in the recovery.
NCCR is a great networking resource for us, connecting us to peers in our industry and providing a platform for us to discuss common issues, and hammer out potential solutions. They have been particularly helpful in providing a loud voice for chain restaurants in Washington, and being a source for timely information on new rules, regulations and developments that affect us.
Durbin and Gregg are members of President Obama’s deficit reduction commission, and Board members told both the panel should reject proposals for a VAT because the tax would result in higher consumer prices that would have a “disastrous impact” on spending, the economy and jobs. An Ernst & Young study commissioned by the Board subsequently found that a VAT would cost the nation 850,000 jobs, reduce gross domestic product for three years and reduce consumer spending by $2.5 trillion over 10 years. The meeting came just before the House and Senate approved financial services reform legislation, and arguments from the NRF Board helped convince lawmakers to include an amendment sponsored by Durbin that will require the Federal Reserve to establish regulations resulting in “reasonable and proportional” levels for debit card swipe fees. Board members said the $48 billion in credit and debit card fees charged to merchants each year by the card industry have become their third-highest expense after salaries and health care, taking away money that could be used to create jobs. The Board also urged lawmakers to reject the Employee Free Choice Act, which would eliminate secret ballots in union organizing elections and allow unions to be formed if a majority of workers sign a union card. The retail industry was expected to be a key target of organized labor if the “card check” measure had been passed.
NCCR President, Jack Whipple, presented Mike Starnes, VP, Brand Protection, Quality and Regulatory Compliance, Denny’s Inc., with the NCCR Ambassador Award during the NCCR Annual Meeting dinner.
Lynn M. Liddle EVP, Communications, Investor Relations and Legislative Affairs Domino’s Pizza, Inc.
(Member Since 2005)
100 Years of Leadership
www.nrf.com
13
NRF 100
COMMUNICATIONS .
Communications Media Relations
Leveraging strong relationships with high profile media outlets, NRF’s PR department ensured the industry’s voice was heard loud and clear on key retail issues and initiatives. In fact, NRF received 50,000 media hits in 2010 compared with 48,000 in 2008. NRF was out in front on key legislative issues such as health care, credit and debit card swipe fees, proposals for a Value Added Tax and organized retail crime. From an economic standpoint, NRF was a thought leader on the economy, championing the importance of job growth for a sustainable recovery. In 2010, NRF continued to experiment and expand upon its new media outreach strategy, leveraging tools like Facebook, Twitter, Retail’s BIG Blog and LinkedIn to communicate with members and reach out to Capitol Hill. This integrated communications approach ensures NRF’s most important news is not only reaching members of the media but is also being shared directly with retail leaders and industry advocates. NRF also continues to publish other valuable communication vehicles including the NRF, Shop.org and NRF Global SmartBriefs, STORES Magazine and Washington Retail Insight.
Brian J. Esposito CEO AVEYOU Beauty Boutique (Member Since 2008)
Every time I receive my email from NRF Smartbrief, I know there is going to be an article or tip that will dramatically help my company. This combined with the rest of NRF’s services makes it a must have for every type of business. Over the past few years NRF has assisted me in pointing my company into the right direction. Thank you, NRF!
Travis Doster Director, PR Texas Roadhouse, Inc. (Member Since 2007)
NRF has been a valuable resource for us in so many areas, such as product safety, government relations, and loss prevention. Also, the media reception in New York has had a direct impact as contacts we made led to feature stories with CNBC, Associated Press and Forbes.
NRF continues to grow digital retail communities through Facebook, LinkedIn and Twitter – connecting with more than 36,000 retail professionals through 21 NRF divisional social communities
14
National Retail Federation
2010 Annual Report
NRF IN THE NEWS
NRF Vice President Ellen Davis outlines holiday trends and expectations on CNBC’s Power Lunch.
When I came to the USA 20 years ago my company joined NRF and since then I have continued to find them to be an invaluable information and training resource for both myself and my team. They are also the most effective and vocal proponents of our industry with a skillful ability to communicate our views on topical issues to both the media and our elected officials.
Steve Newton President and CEO
Cabinets To Go! (Member Since 2009)
CNBC’s Erin Burnett interviews NRF President and CEO Matthew Shay about retail’s role in economic recovery.
NRF Vice President Rachelle Bernstein appears live on C-SPAN’s Washington Journal program to discuss the impact that a Value Added Tax would have on the economy and jobs.
NRF Vice President Scott Krugman discusses holiday shopping expectations on the Today Show.
NRF Board of Directors Chairman Terry Lundgren shares holiday shopping tips with the women on ABC’s The View.
Joe LaRocca, NRF Senior Asset Protection Advisor, discusses trends in holiday shoplifting and retail loss prevention.
NRF expanded its public policy communications in 2010 by turning the weekly Washington Retail Insight, the industry’s premier newsletter covering retail issues on Capitol Hill, into a daily online publication.
100 Years of Leadership
www.nrf.com
15
NRF 100
COMMUNICATIONS
Washington Retail Insight Newsletter Washington Retail Insight Newsletter Provides Daily Updates on Public Policy Issues Affecting Retailers NRF’s Washington Retail Insight newsletter – the industry’s most comprehensive source of news on public policy issues affecting retailers for more than 15 years – got better and faster in 2010. Washington Retail Insight was published as an e-mail newsletter for the past several years, released each Friday that Congress is in session. But Insight has now become a web-based newsletter located at www.nrf.com/Insight.
Washington Retail Insight articles are open to NRF members and non-members alike in order to keep retailers, members of Congress, federal regulators and the public aware of issues facing the retail industry. But a number of features on the newsletter homepage – such as NRF’s Government and Legal Affairs Washington Update briefing book on policy issues, the monthly Global Port Tracker report and memos from NRF public policy committees – are an exclusive benefit for NRF members.
The change makes it possible to alert retailers on a daily basis to developments on issues ranging from health care reform to tax policy to international trade. Stories can be updated throughout the day, and retailers are often informed of developments within minutes of the passage of legislation or a major announcement from Congress or the Administration. Articles include links to actual legislation, studies, newspaper articles, television video clips and other source material. NRF grassroots action alerts are also highlighted when there is need to rally retailers to contact Congress before an important vote. Retailers can go to the website at their convenience, and can also sign up for daily updates by e-mail or RSS feed.
The change makes it possible to alert retailers on a daily basis to developments on issues ranging from health care reform to tax policy to international trade.
16
National Retail Federation
2010 Annual Report
SOCIAL MEDIA NRF received 50,000 media hits in 2010 compared with 48,000 in 2008.
Record-breaking year for Retail’s BIG Blog with more than 220,000 visits
Vibrant Q&A’s with top executives in the retail community, coupled with insights from NRF staff on public policy, loss prevention and retail trends, has made 2010 a record-breaking year for Retail’s BIG Blog with more than 220,000 visits.
100 Years of Leadership
www.nrf.com
17
NRF 100
COMMUNICATIONS
STORES Media, the publishing group of the National Retail Federation, encompasses the broad and growing number of communications vehicles now derived from STORES Magazine, which has been in print since 1911. STORES Media offerings report on the broad spectrum of strategic issues facing senior retail executives, including retail technology, supply chain and logistics, credit and payment systems, loss prevention, human resources, online retailing, communications, marketing, merchandising, sustainability and other vital store operations.
STORES Magazine Is Available in Print, Digital and Mobile Editions STORES Magazine, NRF’s monthly publication, provides an insider’s view of the entire retail industry by featuring the latest in retail trends, technology and consumer tendencies. Retailers gain access to insightful articles, global coverage of retailing and buying guides with the latest products and services through their STORES subscription. The magazine is viewed by more than 41,000 subscribers in 80 countries and nearly 11,000 people receive a digital version of STORES via e-mail each month. STORES also offers iPhone, iPad and Android versions of the magazine.
“Hot 100 Retailers,” a comprehensive list that provides a definitive ranking of the nation’s fastest-growing retail companies. Additionally, the “E-commerce Elite” highlights the online retailers consumers like most. All three features have earned coverage in the nation’s leading newspapers and other media. STORES Magazine is the flagship of STORES Media, but hardly its only offering. STORES.org offers readers access to contents of the magazine and the full range of other STORES Media content, while STORES Weekly provides updates by e-mail and STORESNews.org provides the latest breaking news. STORES also publishes its Convention Daily newspaper during the NRF Annual Convention, and three buying guides- the Retail Industry Buying Guide, the Software Sourcebook and the Loss Prevention Supplier Directory— to help retailers of all sizes and industry segments find the products, services and software applications they need to run a successful enterprise. Finally STORES Knowledge Series® offers live, interactive web seminars that give retailers information necessary to successfully operate their business. The webinars also give retailers the opportunity to share in an open dialogue, question the speakers and gain deeper insight.
Of the compelling cover stories STORES publishes each month, two highly anticipated annual features are the “Top 100 Retailers,” which ranks companies by U.S. sales, and the
STORES Magazine
Convention Daily STORES.org newspaper
STORES Buying Guides Knowledge Series®
Loss Prevention Retail Industry Software Buying Guide Sourcebook Supplier Directory
18
National Retail Federation
2010 Annual Report
STORES Weekly
STORESNews.org
STORES MEDIA STORES Weekly provides updates by e-mail and STORESNews.org provides the latest breaking news
Stephen M. Knopik Chief Executive Officer Beall’s Inc. (Member Since 1958)
The benefits that we’ve received over the years from our membership with NRF are very significant. Our Loss Prevention team members and our Financial and Information Technologies executives stay connected and in touch with all the emerging issues through committees, conferences and forums. We also rely on NRF to be our voice in Washington on key matters like trade and union card check. What’s more, NRF’s lead role in litigation with credit card companies led to some very meaningful financial settlements!
100 Years of Leadership
www.nrf.com
19
NRF 100
EDUCATION
99th Annual
Convention and EXPO With a theme of “Opportunity,” more than 18,500 retail professionals and vendors from over 74 different countries came together for educational and networking opportunities at NRF’s 99th Annual Convention and EXPO at the Jacob Javits Convention Center in New York City.
Two stalwart retail leaders, Dunkin’ Brands Executive Chairman Jon Luther and HSN CEO Mindy Grossman, also spoke on a panel about how leadership trumps hardship. Attendees of this closing super session were treated to “munchkins” donut holes courtesy of Dunkin’ Donuts.
Inspired Retail Leaders Spoke at Retail’s BIG Show
The EXPO Hall Floor Expands
Convention attendees witnessed another great lineup of influential speakers in 2010. The big question, on the heels of 2008-2009’s economic woes, was whether retail was poised to emerge from a general consumer pullback on discretionary spending. Attendees at Retail’s BIG Show offered a qualified “yes.” The state of the global economy, growing optimism for luxury retailing, sustainability, the new value-conscious consumer and retailing’s “new rules” were prevalent themes throughout the conference.
The EXPO floor, featured 160,000 square feet of exhibit space that included NRF’s Innovation Station – a fully interactive concept area where attendees could experience all of the coolest new technologies and products in retail today. The space featured more than a dozen companies who wowed the attendees and press throughout the show and gave the term “customer experience” new meaning.
The convention’s marquee speaker, Tesco chief executive Sir Terry Leahy spoke to attendees about the world’s third largest retailer’s emergence as a global powerhouse, and offered insights on management lessons coming out of the last recession in the 1990s. Leahy presented some of the principles Tesco followed along the way including how find the truth from your customers; audacious goals help; vision, values and culture matter more than strategy; and simple beats complex. Delivering a powerful and inspired presentation, Leahy received some of the highest ratings from the audience in the history of the event. Other important speakers included Family Dollar Chairman and CEO Howard Levine; former JCPenney and Federated Department Stores Chairman and CEO Allen Questrom; designer Tory Burch; Saks Chairman and CEO Steve Sadove; and Best Buy President of Financial Services Mark Williams.
20
National Retail Federation
2010 Annual Report
Blogging (and tweeting) from the BIG Show This year, NRF used many social networking channels including Retail’s BIG Blog and tweets straight from the convention that captured many of the insights from educational sessions, scenes from the EXPO floor, and unique moments at Javits.
Keith Lipert President Keith Lipert Gallery (Member Since 2004)
The big issues that challenge us from healthcare to credit card interchange can only be addressed by having a strong unified advocate on our behalf--- NRF. Additionally, the speed with which mobile and web technology is moving has made the Big Show indispensable for keeping ahead of trends.
1.
2.
1. Sir Terry Leahy, CEO, Tesco 2. Allen Questrom, former CEO, JCPenney and Federated Department Stores 3. Tom Bell, CEO, Bank of American Merchants Services 4. Matt Kistler, Senior Vice President for Sustainability, Wal-Mart 5. Prof. Tom Davenport, Babson College and Chris McCann, President, 1-800-Flowers 6. Tory Burch, Founder and Creative Director, Tory Burch, listens to Marc Gobe, President, Emotional Branding. At right is Stephen Sadove, Chairman and CEO, Saks
5.
3.
4.
6.
Maged M. Mansi CEO Mansi Eyewear (Member Since 2006)
NRF has helped me sharpen my skills and challenged my ambitions. It addressed my needs to grow a stronger business at a more pleasant work atmosphere. NRF says: “YOU ARE NOT ALONE; Everybody faced your challenges once and your answers are here, come to the Big Show and learn, all the top guns are here.”
7.
8.
10.
9.
7. Jon Luther, Dunkin’ Brands Executive Chairman 8. Tony Hsieh, CEO, Zappos accepts the Retail Innovator of the Year award from Kip Tindell, CEO, Container Store 9. Mark Williams, President of Financial Services, Best Buy 10. Jill Puleri, Worldwide Retail Industry Leader, IBM
100 Years of Leadership
www.nrf.com
21
NRF 100
EDUCATION
Shop.org Annual Summit The Shop.org Annual Summit was bigger and better than ever in 2010, attracting a record-breaking 3,500 industry experts to Dallas to explore emerging trends and share best practices in digital retail. The summit featured leaders in the digital and cross-channel industry including Urban Outfitters Inc. CEO Glen Senk, Southwest Airlines President Emeritus Colleen Barrett, and senior executives from Groupon and Facebook. The summit kicked off with the first ever Shop.org interactive boot camp, which focused on social media and search engine optimization and provided more than 250 attendees with practical and tactical tips to improve their own efforts. A kickoff networking event held on the exhibit hall floor was the perfect opportunity for attendees to mix and mingle with the
Member’s of Shop.org’s Board of Directors, past and present, gather on the Dallas Cowboys Star at the special networking event held at Cowboys Stadium during the 2010 Annual Summit. Shop.org Board of Directors Chairman, Rich Last, opens the Annual Summit with some encouraging words about the growing importance of innovation in the digital retail community.
National Retail Federation
The three-day event featured inspiring keynote presentations; concurrent sessions on mobile, cross-channel optimization, tactics and the customer experience; one-on-one tutorials; roundtable discussions; and numerous networking opportunities, including a dinner on the field of Dallas Cowboys Stadium. Armed with data from Shop.org’s justreleased State of Retailing Online Report, Summit emcee Sucharita Mulpuru of Forrester Research brought the entire program together by sharing a few of the highlights from the report while introducing keynote presenters.
For the third year in a row, the Annual Summit welcomed one highly-ranked session: “40+ Specific Things You Can Do to Make More Money Next Week”
The Annual Summit featured an attendee favorite keynote presentation with executives from Facebook and Groupon, moderated by Norwest Venture Partners.
Forrester Research’s VP and Annual Summit emcee, Sucharita Mulpuru addresses a full-house as she shares research findings related to each of the five keynote presentations at the Summit.
22
“who’s who” of digital retail and network with colleagues while viewing innovative e-commerce solutions and services.
2010 Annual Report
Loss Prevention Conference and EXPO
Premiere Educational and Networking Opportunities Hosting 2,500 loss prevention professionals, the 2010 NRF LP Conference was THE event to attend. Record-breaking numbers of attendees descended upon Atlanta for three days of education, networking with peers and solution providers, and problem solving. The conference attracts the entire breadth and depth of retail including grocery stores, department stores, restaurants, drug stores, independent and online retailers. Attendees participated in interactive sessions covering: • Active Shooters and Workplace Violence • Organized Retail Crime • Partnerships Between Retailers and Critical Public Entities As partnerships between retailers and law enforcement increase in importance, representation from government agencies such as the U.S. Department of Homeland Security (DHS), U.S. Immigration and Customs Enforcement (ICE), the FBI and the U.S. Secret Service, along with men and women from local and state law enforcement, is even more important. Representatives of these agencies were available at the Fusion Center or specific sessions, including representatives from the Los Angeles Police Department and Albuquerque Police Department during a session about community policing.
Captain Bill Williams (LAPD) and Chief Ray Schultz (Albuquerque PD) were recognized at the Conference for their partnership with retail loss prevention.
Bill Titus, VP, Loss Prevention and Safety for Sears Holdings Corporation and the Chair of the NRF LP Advisory Council delivers a welcome address during the kick off session.
This year’s conference offered a wildly popular new Diversity in LP Reception.
Professional development was a key area of focus, with sessions ranging from developing media and crisis communication skills to how to advance your career and ways to use social media to improve your reputation.
EXPO Hall in a Nutshell Featuring more than 175 leading loss prevention solution providers, the EXPO hall provided an excellent venue for onhand training and discussions with vendors. Back by popular demand, the NRF Fusion Center expanded to a two-day format and provided networking opportunities with leading law enforcement.
A record crowd converged on Atlanta for this year’s conference. Networking events, educational sessions and the EXPO hall were all crowded. 100 Years of Leadership
www.nrf.com
23
NRF 100
EDUCATION
Innovate ‘10
Retail Advertising Conference and Shop.org’s Strategy and Innovation Forum combine to create Innovate
In an industry where change is the only constant, retail marketers are tasked every day with bringing innovation to their promotional efforts. With customer-facing innovation at the forefront of the industry, the Retail Advertising and Marketing Association (RAMA) community worked together with Shop.org, NRF’s digital division to produce the first Retail Innovation and Marketing Conference: Innovate 2010. Held in San Francisco, the land of innovative thinking, the event was a sellout with more than 700 attendees jamming into the Westin St. Francis hotel to deliberate on topics such as the Cross Channel Marketing Mix, the New Customer, Social Media, Creative and the Customer Experience, and Mobile Retail.
Speakers included: • Tracy Benson, Senior Director, Interactive Marketing and Emerging Media, Best Buy • Julie Bornstein, Senior Vice President, Sephora Direct • Pat Connolly, Chief Marketing Officer, Williams-Sonoma • Ron Garriques, President of Communication Solutions, Dell • Jeffrey Rayport, Founder, Marketspace LLC • Cyriac Roeding, Co-Founder, Shopkick • Peter Sachse, Chief Marketing Officer, Macy’s • Gary Wohlfeill, Creative Director, Moosejaw Also featured was the Innovation Zone, a captivating, must-see demo area where attendees could preview the most innovative and integrated solutions from key business partners and suppliers.
Cyriac Roeding, Co-founder, Shopkick, Inc. talks about the mobile advertising market and how it influences retail.
24
Lisa Gavales, CMO, Express shares her philosophy for brand consistency across all channels.
Robert Raible is inducted into the Retail Advertising Hall of Fame.
Tracy Benson, Sr. Director, Interactive Marketing & Emerging Media, Best Buy demonstrates how to capture and convert customers with mobile apps.
Pat Connolly, CMO, WilliamsSonoma, Inc. explains his strategy of embracing online/ interactive channels to succeed in the tough economy.
National Retail Federation
2010 Annual Report
Business Partners A special thanks to our business partners who support NRF and its divisions throughout the year and around the globe.
100 Years of Leadership
www.nrf.com
25
NRF 100
EDUCATION
Research NRF Research Reaches Across All Divisions NRF prides itself as the leading retail association providing a plethora of retail industry research to members, politicians, the media and the public. With more than forty NRF-led surveys and ten original research publications across the Federation and its divisions, the NRF brand has become synonymous with relevant and timely industry data.
Retail Horizons: A Definitive State of the Industry Report for Retail Execs and Opinion Makers The eighth annual edition of this definitive state of the industry report was released at NRF’s annual convention in January 2010 in a session attended by nearly 400 convention participants. KPMG sponsored the benchmarking, trends and intentions research, and joined the NRF Foundation in analyzing more than 1,000 data points compiled from responses of 310 executives at 138 U.S. retail companies. The information RETAILHORIZONS covered areas including finance, e-commerce, store and field operations, supply chain management, merchandising, marketing and advertising, customer insight, human capital and information technology. eighth annual
RETAILHORIZONS BENCHMARKS FOR 2009, FORECASTS FOR 2010
26
BENCHMARKS FOR 2009, FORECASTS FOR 2010
National Retail Federation
2010 Annual Report
Gauging Consumers’ Intentions and Actions Throughout the Year NRF partners with BIGresearch throughout the year on consumer spending surveys aimed at gauging when, where and how consumers will shop. This includes projections on consumer events such as Valentine’s Day, back to school and Halloween, as well as the types of media that influence shoppers’ purchasing decisions. Additionally, NRF’s Annual Winter Holiday Survey serves as the key measurement throughout the industry as well as in the news media when it comes to what consumers will spend on Christmas, Kwanza and Hanukah.
Exploring Trends in Online, Mobile and Multichannel Management Shop.org has capitalized on the rapid growth of digital retail channels within the past few years, with a focus on digital research, to the benefit of Shop.org members. The State of Retailing Online, conducted in partnership with Forrester Research, explores trends and benchmarks for emerging areas such as mobile, social media and international expansion, as well as online marketing, expenses and revenues, and multichannel management. The eHoliday Study, conducted with BIGresearch, reports on pre- and post-holiday marketing, merchandising and operational trends across retailers and consumers.
Leading the Way in Loss Prevention Research With three highly regarded annual research reports on organized retail crime, national retail security and return fraud, NRF’s Loss Prevention Department has positioned itself as a leader in asset protection research. The National Retail Security Survey benchmarks retail shrinkage and operational information about how retailers are combating losses. The survey showed that shrinkage averaged 1.44 percent of retail sales in 2009, for a total of $33.5 billion. NRF’s 2010 Return Fraud Survey found that return fraud cost retailers an estimated $13.95 billion during 2010, up from $9.59 billion in 2009. Additionally, 88.8 percent say they have had a problem with employee return fraud.
NRF Port Tracker: a Monthly Gauge for Industry Container Traffic NRF’s monthly Global Port Tracker report examines retail container traffic at the nation’s major retail container ports, As a free resource for NRF retail members, the report includes historical data on the volume of cargo imported through each port, comparisons with the previous year and forecasts of cargo volume six months into the future. With the amount of merchandise retailers decide to import closely linked to expectations for sales, this report is relied upon by the Federal Reserve and others as a leading economic indicator for the retail industry.
Retail Industry Indicators Provide Historical and Futuristic View of the Industry
benchmarking reports on retail worldwide. The Associate Member Advisory Council provides the expertise for the “Peer Reviewed” section of this center.
Annual Stores Features Attract High Profile Coverage Of the many compelling cover stories STORES publishes each month, two highly anticipated annual features are the “Top 100 Retailers,” which ranks companies by U.S. sales, and the “Hot 100 Retailers,” a comprehensive list that provides a definitive ranking of the nation’s fastest-growing retail companies. Additionally, the “E-commerce Elite” highlights the online retailers consumers like most. All three features have earned coverage in the nation’s leading newspapers and other media.
Retail Industry Indicators is an annual report published by NRF on trends in the retail industry. From retail’s contribution to the U.S. economy to average employee compensation by year, the report pulls from government data and NRF research to provide hundreds of statistics on historical retail sales, job growth and retail profitability.
NRF Launches New Mobile Retail Initiative In April 2010, NRF announced the launch of a new retailer-led initiative designed to leverage existing and emerging mobile technologies for retailers seeking to begin or expand m-commerce within their brands with a focus on developing standards and best practices as well as creation of original research. One of the first deliverables from the initiative was the Mobile Blueprint, a whitepaper designed to provide retailers with a road map for executing best practices in their mobile retail strategies.
Members Create Relevant Thought Leadership Through NRF’s Retail Reference Center The NRF Retail Reference Center, a free resource for NRF members, was launched in 2009 and features original research, case studies, emerging industry trends, innovative ideas, and
100 Years of Leadership
www.nrf.com
27
NRF 100
COMMUNITIES
eCommerce Shop.org, NRF’s digital division, serves as the world’s leading trade group for digital retail. And with more than 650 members, it is the authority on growth opportunities in online and multichannel retail. Shop.org offers value to members through superior events, access to groundbreaking research, unprecedented networking, and policy development. One of the most valuable aspects of Shop.org membership continues to be their award winning conferences and webinars. These events cover many of the most important topics in digital retail including search engine marketing, email optimization, social media, mobile, and online merchandising to name just a few. Shop.org has a vibrant and active content committee made up of a cross-section of retailers from 1800Flowers.com, eBags, New York and Company, Crate&Barrel, American Eagle Outfitters, and Ann Taylor among others. The group meets on a monthly basis to shape content for events including: Retail Innovation and Marketing Conference. This inaugural event brought together executives from Shop.org and NRF’s Retail Advertising and Marketing Association division to discuss cutting-edge retail innovations that can help members achieve their business goals. Annual Summit: Shop.org’s largest conference is the “mustattend” event for the digital retail community. This year the Summit attracted over 3,500 attendees who learned from inspiring keynotes and tactical breakout sessions, enjoyed unprecedented networking opportunities, and forged relationships that helped their business grow in the sold-out EXPO Hall. May is Online Marketing Month: This was Shop.org’s first virtual event, featuring five webinars, 11 regional dinners, 30 educational video tips, and numerous marketing white papers. Topics included achieving real world return on investment with social commerce, predicting search engine marketing success, and succeeding in the world of email. The cornerstone was the Social, Mobile, and Marketing State of Retailing Online Report that set valued benchmarks for members to use to measure their success. 28
National Retail Federation
2010 Annual Report
Online Merchandising Workshop: Always ranked as a member favorite, this event discussed driving online conversion and improving the customer experience from an online merchandising perspective. Attendees participated in sessions on topics such as online video, social merchandising, best practices in site redesign, and secrets for top converting websites. Webinars: Shop.org members also enjoyed monthly webinars that featured retail speakers from Kenneth Cole, PETCO, FTD. com, Best Buy, and REI to name a few. These webinars were used to introduce the results of new research and provide best practices on a variety of online marketing and merchandising disciplines. One of the most popular and highly ranked webinars focused on the obstacles and enablers of mobile commerce and included specific tactics on getting started and succeeding in the mobile space.
Shop.org Policy Initiatives Shop.org’s initial advocacy agenda has been to expand upon current and previous lobbying efforts from NRF on issues such as credit card swipe fees and spyware. Other issues Shop.org is exploring include click fraud, patent trolling and net neutrality. In 2010, representatives from numerous Shop.org member companies visited Washington to participate in NRF’s annual Washington Leadership Conference. Shop.org’s presence has grown over the years and more members are expected to participate next year. Online retail is getting bigger and the stakes are getting higher when it comes to laws and regulations that impact our industry. One main priority for 2011 involves the possibility of the Federal Trade Commission recommending passage of comprehensive online privacy legislation. This could have serious consequences for the Shop.org membership, and educating our members on the potential disruptive affect of this proposal will be a top priority.
Shop.org’s Policy Advisory Group convenes to discuss strategies affecting the lobbying efforts of digital retail.
Retailers gather for Shop.org Regional Dinners held throughout the year in various cities. Dinners are free for retailers wanting to network and learn from peers in their areas of the country.
Retailers gather around the table to discuss topics of interest at our roundtable discussions, an attendee favorite offered at all Shop.org events.
100 Years of Leadership
www.nrf.com
29
NRF 100
COMMUNITIES
Marketing NRF’s marketing division, the Retail Advertising and Marketing Association, is the industry’s premier community for the brightest and most creative thinkers in the industry – chief marketing officers, their direct reports and the industry suppliers that partner with them. RAMA provides unique industry research, leading-edge educational programming, and specialized networking opportunities for senior-level marketing professionals and their teams. The marketing and advertising community continues to grow as more and more NRF member companies take advantage of the added value of participating in RAMA as a benefit of NRF membership.
The stars burned bright at the Racie Awards The industry’s coveted Retail Award for Creativity, Innovation and Excellence – the Racie – was presented to some of retail’s most creative minds. Sears Holdings Corporation’s Heroes At Home Campaign was honored with the Peter Glen Award for cause marketing while Ehrlich Pest Control was awarded the “Best of the Best” for its radio advertisement, “It’s Ok.” Robert Raible, Vice President of Brand Integration at Sears Holdings Corporation and a long-time RAMA Board Member, was inducted into the Retail Advertising Hall of Fame. RAMA’s Hall of Fame has remained a cornerstone of the association for more than 50 years and continues to set the standard for the industry.
Best Buy, OfficeMax, Bootlegger and the Gold Marketing Group shared insights into the success of their brands. In October, RAMA partnered with SOYSAL’s Retail Days Conference in Istanbul to deliver presentations by retail leaders from JCPenney, Best Buy and RAMA to more than 3,000 attendees. Both events were huge successes for RAMA and the event organizers.
Inaugural Creative Summit Brings the Creative Community Together Building on the CMO Summit, RAMA’s first Creative Summit helped creative directors build on the strategic vision identified at the CMO Summit just two months earlier. Speakers told the story of how brands like CVS, Heineken, JCPenney, Moosejaw, Coke and others used inspiration, collaboration and integration to achieve clarity and success for their brands and promotional efforts. The afternoon session was an interactive workshop where 65 attendees broke up into teams to brainstorm on how to take the “kaleidoscope experience” to the next level and use social, digital and traditional media to enhance the customer’s promotional and shopping experience in the retail industry of the future.
International Partnerships Strengthen NRF and RAMA Brands RAMA continued its strategy of global outreach, building and strengthening the worldwide community of retail marketing professionals through partnerships that resulted in presentations to nearly 4,000 retail executives in South Africa and Turkey. In August, RAMA partnered with the Caxton Group and CTP Publishers for the second time to bring a group of industry leaders to Johannesburg and Cape Town. More than 700 retailers attended two separate events where top marketing executives from Sears Holdings Corporation,
30
National Retail Federation
2010 Annual Report
RAMA Executive Director Mike Gatti shares insight on the mobile shopping trend and how consumers are using smartphones for holiday shopping.
CMO Summit Brings Clarity to the Kaleidoscope With so many variables affecting success, the job of a chief marketing officer is like looking at the world through the many lenses of a kaleidoscope. This year’s CMO Summit, held in Scottsdale, Arizona, offered a fresh outlook and discussions on issues from blue sky to green grass to a record attendee audience of CMOs and industry partners. At the end, attendees walked Doug Collier, VP and Chief Marketing away with the tools Officer, La-Z-Boy shares his thoughts and resources that will during the Kaleidoscope discussion at help them define clarity the RAMA CMO Summit.
in work, in creative and in what their customers want. Sessions included: Does Your Intuition Cloud Your Marketing Lens with author Dan Simons; Game Changers: New Analytics and the CMO Perspective; Nikon Captures the Moments to be Social; Shopper Marketing Redefined … It’s not Your Father’s Oldsmobile Anymore! and the Kaleidoscope Experience: the Shifting Lens of the Retail Experience. Attendees formed into work groups and shared their vision on the question “If you had the opportunity to invent retail for the first time, what would the shopping experience look like?” After an hour of discussion and sharing, retail CMOs and industry partners shared some mind-blowing ideas and incredible visions of the future with each other and the rest of the group.
RAC Lite South Africa speakers and their hosts from Caxton and CTP Partners pose for a picture at the entrance to the Lukimbi Safari Lodge in the Kruger Wildlife Refuge outside Johannesburg.
Greg Clark, VP Creative Leadership and Process, JCPenney, Helane Blumfeld, SVP, Senior Creative Director, Macy’s and Gary Wohlfeill, Creative Director, Moosejaw talk about inspiration, ideation and collaboration at the RAMA Creative Summit.
Members of the U.S. retail contingent, representing RAMA and NRF at the Retail Days Conference in Turkey, pose for a portrait with their host from SOYSAL during the Black Tie Awards Gala at the Four Seasons Hotel in Istanbul. 100 Years of Leadership
www.nrf.com
31
NRF 100
COMMUNITIES
Loss Prevention NRF Loss Prevention Connecting the Dots for LP Teams throughout the Country
NRF LP Reaching Out to All Levels of Retail Members As with other retail disciplines represented by NRF, LP professionals from the junior-most store detective to the seniormost executive are encouraged to get directly involved. This year, the popular NRF Investigator’s Network brought together retail LP executives, shopping center security and law enforcement officials to network and discuss critical industry challenges. Nine meetings attracting more than 800 retailers allowed members to share alerts and potential threats, discuss the most current regional trends and network with law enforcement. These meetings consistently help loss prevention associates solve crimes affecting their stores, the industry and their community.
In 2010, NRF’s loss prevention community hit a home run. As retailers and LP teams throughout the country were asked to do more with less, NRF leveraged relationships at private and public organizations to help LP professionals. In spring 2010, NRF announced a partnership with eBay, the world’s largest online marketplace, to help track organized retail criminals using the site to fence stolen merchandise. The partnership has shown positive results with many successful stories and cases resolved for NRF members. Additionally, a pilot program launched between NRF’s Joint Organized Retail Crime Task Force and the U.S. Immigration and Customs Enforcement Investigations Office was an overwhelming success. Operating in key US cities, the program has yielded 27 arrests, seized $4 million in assets and helped retailers significantly.
Crowd Management – Are your stores ready? In-store events, promotional offerings and celebrity appearances are a way of business for retailers. To carry out safe and successful events, every part of the retailer’s team needs to be involved. Loss prevention and mall security have
DHS details retail partnerships at LP Senior Executive Summit Senior loss prevention professionals gathered in Dallas for the 6th Annual NRF Loss Prevention Senior Executive Summit. Executives from Ann Taylor, Barnes & Noble, GameStop, Macy’s, PETCO, Safeway, Kroger and more networked, exchanged ideas and spent an entire day in interactive discussions and learning sessions. The Summit kicked off with a keynote address highlighting the important partnership between the retail industry and the U.S. Department of Homeland Security and covered two distinct partnerships retailers benefit from by working with DHS. Security analysts briefed loss prevention executives on security risks and issues concerning retailers stemming from terrorist alerts in Europe during fall 2010. Next, the group was taken through the details of a “National Level Exercise” that will test organizations operating in the central United States in May 2011. The event will simulate a catastrophic emergency requiring emergency management and business continuity teams to test their policies to fullest extent.
32
National Retail Federation
2010 Annual Report
The most popular features of the Summit were its retail-sector breakout sessions and roundtable discussions. During these discussions, attendees network and exchanged ideas with peers from their retail sectors and came up with solutions to everyday challenges as well as covering potential issues to be on the lookout for. The roundtable discussions covered workplace violence, development and retention of top talent, legal liability issues, data mining and analytics, new technology trends and organized retail crime. Each year, the discussions are the highest rated component of the meeting. Additionally retailers report that by attending this high-level meeting, they are able to find solutions to everyday challenges and implement them at their respective organization. Additionally, creating an intimate environment for the senior-most loss prevention executives promotes a fantastic peer-to-peer environment.
Michael A. Brizel Executive Vice President & General Counsel Saks Incorporated (Member Since 1948)
NRF has been an invaluable resource to the attorneys at Saks, enabling all of us to network with counterparts at other retail companies. Additionally, attending the Loss Prevention meeting in Atlanta and participating in a panel discussion with other C-level executives provided me deep insight into loss prevention and all of its dimensions.
NRF’s LP Legislative Committee recognized John Heavener for his work on the Georgia Smash & Grab legislation. (l-r): Mike Liberatore (Macy’s); John Heavener (Georgia Retail Association); Joe LaRocca (NRF)
become more sophisticated at managing the crowds. To assist, NRF updated its crowd management guidelines, helping retailers maintain safe and fun events for their customers.
NRF’s LP Team Honored by FBI In early Spring, two members of NRF’s LP team were each presented with the FBI’s Excellent Service in Public Interest award as recognition for their work in fighting organized retail crime. Since 2005, the FBI has recognized NRF’s LP team four times for the strides it has made to educate retailers and law enforcement officials about organized retail crime and other types of serious fraud within the industry.
Steve Ippolito Director of Loss Prevention The Talbots, Inc. (Member Since 1981)
The NRF Loss Prevention Community is a cohesive and dynamic group. As an active member, you reap the rewards of networking with your peers on current issues as well as have the opportunity to benchmark your company’s programs with those of other NRF members. As a member of the Loss Prevention Advisory Council, and Vice Chair of the LP Conference Planning Committee, I believe the NRF provides the LP executive with crucial opportunities for education, networking and best practices which I, and the entire LP Team at Talbots, have benefitted from.
Our NRF membership has proven to be a valuable resource for many areas of our organization over the years. Our Retail, Finance, Information Services, Legal and Loss Prevention departments have all availed themselves of NRF resources including conferences, webinars, white papers, standards & legislative updates. As a loss prevention professional, the annual NRF Loss Prevention Conference is a must attend event as I think it is the best loss prevention training and networking event in the industry for anyone committed to staying informed and current about trends and technology in our rapid changing retail world. In short, we belong to NRF because it helps our business and helps us to do our jobs more effectively and efficiently.
Alan S. Tague, CFI NRF’s LP Advisory Council serves the industry throughout the year by driving the content of surveys, white papers and the Loss Prevention Conference.
Vice President, Loss Control Gander Mountain Company (Member Since 1997) NRF committee members make a difference across the country by working with law enforcement. (l-r): Dennis Dansak (Kroger) Chief Charlie Beck (Los Angeles Police Department), Eliot Green (TJX)
General session during the LP Sr. Executive Summit on counterfeit tender and its effect on retailers. 100 Years of Leadership
www.nrf.com
33
NRF 100
COMMUNITIES
Information Technology NRF CIO Council
ARTS: Ensuring Affordable Technology for Retailers
This is an invitation-only committee made up of 50 of retailing’s most prominent Chief Information Officers. It provides a valuable opportunity for peers to share ideas and experiences, and in doing so helps guide NRF’s technical staff to create new projects that reflect the industry’s needs.
All successful retailers need to better connect with their customers. Today, however, many customers are telling the retailer how they want to be engaged or contacted. NRF’s Association for Retail Technology Standards division helps retailers meet these challenges because it makes new technology less expensive for retailers to implement. This has been the goal of ARTS since it was founded in 1993. ARTs helps retailers and solution providers work together on technology standards.
Shop.org IT Council To meet the challenges of the ever-changing landscape of e-commerce technology, NRF and Shop.org formally announced the creation of the Shop.org IT Council. The purpose of this committee is to create a community for information technology executives to share best practices and discuss common challenges within both multi-channel and pure online retail.
European Retail Technology Summit The Retail Technology Summit, in its eighth year, is one of the industry’s most influential retail technology events in the European Union. The summit, held in Amsterdam and produced by NRF and ARTS in partnership with Germany’s EHI Retail Institute, attracted more than 200 IT executives from some of the world’s leading retail companies.
Launch of NRF’s Mobile Retail Initiative NRF launched its Mobile Retail Initiative to offer best practices and learning opportunities for retailers entering the mobile space. As a result this group has produced a Mobile Blueprint to guide retailers in planning and implementing initial mobile applications, including customer marketing, payments and internal operations.
NRF Sends Letter to PCI Council and Credit Card Companies NRF continues to work to create more transparency and clarity in how data security standards are developed. In 2010, NRF along with several trade associations representing merchants in the retail, restaurant and hospitality sectors sent a joint letter to the Payment Card Industry Security Standards Council and credit card companies outlining guidelines that could be implemented immediately that would make PCI more effective and cost efficient.
34
National Retail Federation
2010 Annual Report
In 2010, the ARTS Board made the decision to direct their standards work to support business strategy. ARTS focused on showing retailers how to enable technology to quickly support the ever-changing business needs to effectively satisfy their customers. • Consumers now want to communicate with their favorite retailers in new ways. In 2010, ARTS released version 1.0 of the Mobile Blueprint, a whitepaper to guide retailers on defining their mobile strategy. To further support mobile in retail, ARTS is updating the digital receipt standard to include electronic coupons and has released a first draft of a payment standard to simplify PCI compliance and facilitate mobile payments. ARTS will be releasing version 2.0 of the Mobile Blueprint in the first quarter of 2011. • Consumers are concerned about sustainability. ARTS is working with organizations in Europe and North America to develop standards that will allow retailers to give customers information about food safety and the carbon footprint of many products they purchase. • Retailers need to transform data into actionable information. The ARTS Data Warehouse Model version 2.0 and associated key performance indicators, scheduled for release in spring, 2011 will enable them to do that. • Retailers want guidance on how they can take advantage of new developments in cloud computing and service oriented architecture. The business process documentation that ARTS is developing demonstrates how retailers can make use of these technology strategies in a way that supports their business, not the other way around. To tie this all together, ARTS held its 2nd Annual Users’ Meeting in Orlando. In September 2010, more than 100 retailers and solution providers met to discuss how retailers can implement standards most effectively.
Osman Senturk CIO LCWaikiki (Member Since 2010)
This year we have started a project for developing our integrated retail software. We could not have found a better source than the NRF ARTS library for supporting our critical decisions with industry best practices. That was an entry for us to start exploring NRF know-how.
NRFtech 2010: CIO Summit Draws Big Names and Even Bigger IT Thought Leadership The retail industry’s most influential Information Technology leaders gathered in Half Moon Bay, CA, in mid-August for a two-day summit to discuss current trends, how-to’s and the latest technological advances in retail IT. More than 60 retail brands were represented at NRFtech, with CIOs from Yum! Brands, Sears, Cabela’s, and Walgreens keynoting the event. The overwhelming theme at this year’s event focused on how IT departments are developing a new role within management when it comes to optimizing business practices, briefing management on new technologies, and even providing insight into the customer experience. Walgreens CIO Tim Theriault talked about how the company is leveraging IT to improve the customer experience through a curbside-pickup pilot program, centralizing customer data, and providing employees with technology to help them do their jobs. Cabela’s CIO Charles Carstens shared how the company transformed itself from a catalog retailer to a multichannel merchant — and connected more powerfully with customers along the way. Rue La La COO Jeff Marshall and PETCO CIO Herman Nell shared their thoughts on how to sell this new and evolving role throughout the organization.
2.
1.
3.
4.
1. Juan Enriquez, Managing Director, Excel Venture Management 2. Lori Shaffer of SAS speaks with Jeff Marshall, COO, Rue La La 3. Jeff Marshall, COO, Rue La La; Herman Nell, CIO, Petco; Brian Kilcourse, Managing Partner with Retail Systems Research 4. CIOs take a networking break at NRFtech ’10 Dave Hogan, SVP Retail Operations & CIO, NRF
NRF provides the very best return on my time investment for all things retail; every other option is child’s play. NRF is the path to the future of retail technology innovation and is at the forefront of the technological advances that will change the meaning of “retail” just as surely as the Internet changed the meaning of “communication”. I have benefitted from the guidance and expertise of NRF leadership in the areas of wireless and location-aware technologies, next generation loyalty and point of sale systems and advanced product and customer analytics to name a few.
Arthur Tisi Chief Information Officer Fairway Market (Member Since 2008)
100 Years of Leadership
www.nrf.com
35
NRF 100
COMMUNITIES
Sustainability Sustainability Consortium Boosts Efforts to ‘Green’ the Retail Industry Retail sustainability efforts drive innovation and productivity for the industry. Most importantly, quickly evolving consumers are responding to sustainable practices in increasing numbers. In response to this trend, the Sustainable Retailing Consortium (SRC) was founded in 2007 by and for retailers with strong support from the associate members of NRF. In addition to producing educational sessions on sustainability for the NRF Annual Convention every year, the SRC has been working diligently to develop new meaningful tools to help retailers benchmark where they line up on sustainability, as well as help companies create a blueprint for moving forward with sustainable practices in ways that make sense for the companies and their customers. In 2010, the SRC launched a Carbon Footprint Calculator with Verisae as a tool retailers can use to begin to understand how to address the carbon footprint their company creates and
then begin to assess how to minimize the negative impact. The Sustainability Webinar Series has created an ongoing dialogue with member companies and drives meaningful participation from all sectors of the industry on a broad range of topics. The 2010 supply chain webinar, featuring Walmart and SAP, drew more than 320 participants. Most retailers are searching for how sustainability resonates with the consumer, and the SRC partners with McMillan Doolittle to produce and publish original research annually on the evolution of the consumer outlook on sustainability. All of these resources can be found on our newly created Sustainability Headquarters page on the NRF website www.NRF.com/sustainability. Additionally, in 2011, the SRC partnered with the sustainability team at SAP to create the first annual International Sustainability Symposium which will be held during the NRF’s Annual Convention. As the need for more sustainable business practices grows, NRF and the SRC will continue working with our retail members and colleagues in the industry to address sustainability concerns in the areas of supply chain, recycling, evolving consumer behavior, store design and other top priorities for retailers. Ken Saeckl, Chief Operating Officer of Gunther Mele & Co-Chairman of the SRC, addresses the 99th Annual Convention on leading issues in sustainability.
Ken Nisch, Chairman of JGA, discusses sustainability in in-store design at the NRF Design Studio during the 99th Annual NRF Convention.
36
National Retail Federation
2010 Annual Report
Supply Chain Retail Execs Gather for NRF’s 6th Annual Human Resources Summit NRF’s sixth annual Human Resources Executives Summit was held in Dallas in October. More than 100 leading HR executives and employment law attorneys participated in timely sessions on current human resources and wellness practices and employment law litigation. Members of NRF’s Committee on Employment Law, Human Resources Executives Council and Health and Employee Benefits Committee attended the sessions and networking events, as did other leading retailers from 56 total companies. Key human resource sessions included aligning human resources to company growth, creating a sustainable sales culture and meeting the challenges of a changing workforce, employee handbooks, and training smart managers. Other important presentations included the latest developments from the Equal Employment Opportunity Commission and the National Labor Relations Board, navigating today’s digital workplace, managing the multilingual workplace and wage-andhour compliance issues.
NRF Council Helps Keep Supply Chain Moving While 2010 was a continuing year of recovery for the retail industry, challenges within the supply chain made the recovery more difficult. NRF’s Strategic Supply Chain Council members worked closely on a number of these challenges, including ocean carrier capacity, cargo security regulations and clean truck programs at U.S. ports. These issues, among others, were addressed at council meetings held in January and May with executives from Boscov’s, Kohl’s, the Army and Air Force Exchange, Office Depot, Charming Shoppes, TJX and Macy’s among those participating. In addition to the two annual meetings, NRF hosted several conference calls on supply chain issues in an effort to allow retail members to benchmark with each other while addressing common problems. From a public policy standpoint, members of the council were kept abreast of key issues impacting the industry, such as port trucking, supply chain security, and cap and trade as well as key legislation including the highway reauthorization bill, amendments to the Federal Aviation Administration Authorization Act and the customs reauthorization bill.
In an effort to promote continued peer discussion and knowledge sharing around strategic advances in transportation and logistics, NRF will host its first Global Supply Chain Summit in Columbus, Ohio, in April 2011. The meeting will focus on people, compliance and sustainability.
100 Years of Leadership
www.nrf.com
37
NRF 100
COMMUNITIES
Finance Benefits of Retail Focused, Peer-to-Peer Benchmarking Cited as Greatest Advantage to Membership in Finance Councils NRF’s Financial Executives Council, Internal Audit and Compliance Council, and IT Audit Council provide a unique forum for members to engage with industry peers, remain informed on current and emerging financial and audit issues, and share information. In addition to semi-annual meetings, the councils participate in surveys and discussions throughout the year covering topics such as enterprise risks, audit committee training, mileage reimbursement, gift card dormancy fees, capitalization policies and mobile device security, allowing unparalleled access to immediate, industry-specific information.
Finance Councils Grow in 2010 • More than 85 retail companies participated in the three NRF finance councils. • Seven meetings were held and covered hot topics such as social media risks, changing dynamics in retail real estate, scaling e-commerce operations, compliance with the Foreign Corrupt Practices Act, emerging issues in financial reporting, and critical elements in a corporate disaster recovery/business continuity plan. • The finance councils were accredited providers of more than 75 industry-specific continuing professional education credits at no cost to members.
Financial Executives Respond to Proposed Lease Accounting Changes and Expanded Loss Contingency Disclosures Proposed lease accounting changes remained a top priority for retail financial executives in 2010. NRF’s Lease Accounting Task Force was formed to direct the industry’s response to the Financial Accounting Standards Board’s (FASB) proposal. Members of the group, which included representatives from Ann Taylor, BJ’s Wholesale Club, Best Buy, The Clarks Companies, Estee Lauder, Gap, and Macy’s, worked with NRF to voice concerns to FASB about specific requirements in the proposal that would be overly burdensome and costly for retailers, and to provide suggestions on how to achieve the overall objective of the project while minimizing the administrative effort of compliance. 38
National Retail Federation
2010 Annual Report
Dean A. Sheaffer Senior Vice President - Financial Services Boscov’s, Inc. (Member Since 1961)
NRF continues to lead the campaign to create a rational and fair payment system for the U.S. market. NRF leaders provided instrumental influence in Congress, with the Federal Reserve and with the Department of Justice in 2010 -- laying the groundwork for sea change in the U.S. payment system paradigm. The Durbin amendment to the Dodd-Frank bill and the successful DOJ lawsuit against the major card organizations are tangible results of the NRF’s industry-leading efforts.
The FASB proposal would require that most leases be capitalized on the balance sheet. In its comment letter, NRF asked FASB to consider the following suggestions for inclusion in the final standard: exclusion of option periods when calculating the lease term, limiting reassessments to situations when significant changes in circumstances have occurred, excluding contingent rent or basing it on the best estimate rather than a probability weighted average, and allowing adequate time for companies to comply with a final standard since software systems are currently in the development stage. A final standard is expected in 2011. Also in 2010, FASB released an updated proposal requiring expanded disclosures around the timing, likelihood, and potential future cash outflows associated with loss contingencies. Members of NRF’s Financial Executives Council and General Counsel’s Forum filed comments reiterating concerns that the proposed disclosures would be particularly onerous for retail companies due to the large number of frivolous lawsuits filed each year and could mislead investors with limited, out-of-context information. NRF also expressed concerns that expanded disclosures could expose companies to greater risk of loss as a result of arming plaintiffs with critical information and, in some instances, be prejudicial to a case. FASB received more than 340 comment letters and has delayed the effective date while it takes additional time to address the issues raised in the letters.
Legal Peer-to-Peer Insight is Priority for NRF’s Lawyers Committee The NRF General Counsels Forum initiated the NRF Lawyer’s Committee to provide designated legal staff with opportunities to share experiences, insight, and practical tips with their peers. Quarterly meetings in 2010 have addressed topics such as privacy regulation, corporate social media policies and practices, implementation of CARD Act regulations, and health care reform considerations. Speakers have included expert practitioners representing some of the most-renowned law firms.
meeting, held in Dallas, covered topics including the latest developments from the Equal Employment Opportunity Commission and the National Labor Relations Board, navigating today’s digital workplace, managing the multilingual workplace, and wage-and-hour compliance issues. CEL members also participated in a number of benchmarking surveys on key human resource and employment law issues confronting retail and restaurant companies.
Resources for In-House Retail Counsel At the request of NRF’s General Counsels Forum, NRF developed and implemented the GC Forum Listserv as an online tool for members to contact and share information with each other on current legal issues and their application to retail operations. Also in 2010, members continued to utilize and contribute documents to the virtual Law Library, and initiative of the NRF General Counsels Forum. The Virtual Law Library is a repository of legal research and materials of interest to retail in-house counsel.
The Committee on Employment Law This committee serves as NRF’s technical committee on labor law and employee relations matters, and is comprised of retail industry corporate executives and independent labor counsel, as well as human resource and employee relations executives from NRF member companies and associations. The CEL actively files amicus curiae briefs in high profile cases pending before the NLRB and federal courts. The Committee on Employment Law continues to be a successful and popular NRF community, serving as NRF’s technical committee on labor law and employee relations matters. Under the leadership of committee Chairwoman Sheryl Garland of Nordstrom, committee members enjoyed informative programs at the two 2010 CEL meetings, held in spring and fall. Both meetings included roundtable discussions and networking receptions. The first meeting of 2010 took place in Washington and featured presentations on workplace safety and health, immigration compliance, the congressional legislative agenda, and California employment law among other issues. The fall
General Counsels Forum Hears From FTC and SEC NRF’s General Counsels Forum is an invitation-only committee made up of the most-senior legal officers among NRF’s retail membership. The committee discusses trends in areas such as antitrust, securities law, wage-and-hour regulations, alternative dispute resolution and benchmarking of legal programs. During the committee’s 2010 winter meeting, held in New York in January in conjunction with NRF’s Annual Convention, members shared insights on issues including the Foreign Corrupt Practices Act, credit card data security rules, the emergence of patent trolls, and “green” environmental initiatives. Federal Trade Commission Chairman Jonathan Leibowitz and Securities and Exchange Commission Corporate Finance Division Director Meredith Cross were the keynote speakers as the committee held its summer meeting at NRF headquarters in Washington in July. Leibowitz addressed online behavioral advertising practices, provisions of the financial services reform bill later signed by President Obama, data security and efforts to curtail predatory lending, among other topics. Cross discussed efforts to simplify disclosure procedures for public companies and to make the agency more accessible to retail companies seeking guidance on how to comply with its regulations. The General Counsels Forum meets at least twice a year to share strategy and exchange ideas on cutting edge legal and management issues of concern to retail law departments.
100 Years of Leadership
www.nrf.com
39
NRF 100 Kim Goodance President, Merchant Services Americas American Express (Member Since 1997)
Developing Tomorrow’s Industry Leaders The NRF Foundation’s training and certification programs continue to show strong growth and are now offered in hundreds of high school and college classes across the nation. Through certification and training programs, the Foundation is arming job seekers with the skills they need to build careers in retail. With retailers employing 1 in 5 American workers, NRFF programs are supporting the industry’s critical role in the nation’s economic recovery, readying workers to move quickly into available positions as the economy recovers. Train the Trainers sessions conducted by the Foundation staff are in demand from a variety of groups and continue to build capacity for the Foundation’s certification programs. The Foundation continues to buttress the training with information from its Retail Careers Website to capture the imagination of students on the diversity and possibilities a retail career offers. Through NRF University wired, the industry’s online learning platform, specialized new courses in areas such as RFID technology and PCI compliance promote professional growth and retail associates at all levels. Retailers continue to be enthusiastic consumers of this resource, finding high quality, retail-specific courses to supplement in-house training programs.
Spreading Retail Careers Awareness The Foundation is a tireless promoter of careers in retailing. Its new and improved Facebook page, online Retail Careers Center and Retail Careers Blog shape a positive perception of retailing as an exciting career destination where your passion can be your work. Relationships with colleges and universities continue to be a priority for the Foundation. The excellent work of College Partners showcases the broad range of disciplines in retail and the impressive work of students. A growing number of university students attend NRF’s BIG Show each year and find this one of the most enriching opportunities, giving context to their formal studies. 40
National Retail Federation
2010 Annual Report
American Express is proud of its strong partnership with the NRF Foundation to develop the next generation of retail leaders through the aspire2retail Intercollegiate Retail Challenge and recognize retailers who deliver outstanding customer service through the Customers’ Choice Awards. Together, we provide tools and training for retailers to serve customer needs and strengthen the retail industry.
The third aspire2retail Intercollegiate Retail Challenge, sponsored by American Express, tasked six teams of students with analyzing the viability of taking a retail furniture company’s brand to China and justifying a recommendation to senior management. Retail executives acted as mentors to the students, judged the teams’ solutions and sponsored scholarships for the winners. Special thanks to JCPenney, Macy’s, Sears Holding Corporation and Toys “R” Us. The winning team presented their solution to a capacity audience at NRF’s annual convention while many students from competing teams attended to cheer them on.
Training Beyond our Borders The Foundation took standards-based training and certification programs to Asia in 2010. Working with Castle Worldwide and Chinese partner, GBS, the Foundation recruited retail experts to develop a three-tier curriculum in Selling and Service, Retail Management and Operations, and Advanced Retail Management based on NRFF’s industry skill standards. The curriculum is being edited and repackaged for consumption in the United States, providing NRFF with new products and resources to meet growing demands at home and abroad.
Industry Partnerships With support from American Express, the Customers’ Choice Awards honors retailers who demonstrate superior customer service, as nominated by consumers in a survey conducted by BIG Research. In addition to recognizing the year’s “Top Ten” companies at the Annual Retail Industry Luncheon, the Foundation conducted interviews with “Top Ten” for the NRF Blog to showcase their best practices, underscore the importance of excellence in customer service and encourage other retailers to improve every customer experience.
The 2009-2010 Winning Team of the aspire2retail Intercollegiate Retail Challenge at NRF’s BIG Show, in January 2010, along with Christopher Hollins of American Express, and team advisor, Melinda Burke, of the University of Arizona.
Retail Horizons: Benchmarks 2009— Forecasts 2010, released at NRF’s BIG Show, in January 2010. From left to right: Mark Larson, KPMG (moderator), Kimberly Grabel, Saks Incorporated (panelist), Mark Fasold, L.L.Bean (panelist), and Dennis Gingue, Charming Shoppes (panelist).
Rick Phillips, Ph.D. Chief Technology Officer and Vice President Business Development Castle Worldwide We were pleased this year to expand our relationship with NRF Foundation beyond a booming professional certification program. By developing a tiered curriculum now in use in China and likely to be adapted for other companies, we meld CWW’s technical and business capabilities with NRF’s universally-recognized brand and NRF Foundation’s reputation for delivering training to meet retailers’ needs.
Representatives for the retailers who donated funds to defend retailers against patent infringement claims by the Lemelson Foundation agreed to donate the remaining funds to NRF Foundation to underwrite economically challenged students’ access to professional education programs. These will include courses offered through NRF University wired, and other NRFF training tools. NRFF’s Retail Skills Center partners will help implement this program.
Kathy Mance, Executive Director, NRF Foundation, featured in a local Alexandria, Egypt newspaper signs an agreement to develop and localize a Retail Training and Certification program with His Excellency Rashid M. Rashid, Minister of Trade and Industry and Mr. Ahmed El Wakil, President of the Egyptian Chamber of Commerce. 100 Years of Leadership
www.nrf.com
41
NRF 100
ADVOCACY
NRF and Divisional Committees, Councils and Task Force 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 Contact: Mallory Duncan 202-783-7971 duncanm@nrf.com
ARTS Board of Directors The ARTS Board identifies standards to be developed, sets program priorities, approves new and revised standards prior to public release and maintains budgetary oversight for the Association for Retail Technology Standards, a division of the National Retail Federation. NRF Contact: Richard Mader 202-744-8217 maderr@nrf.com
ARTS Unified Point of Service (POS) UnifiedPOS, the specification for both OPOS and JavaPOS, provides retailers freedom of choice in selecting POS devices from multiple manufacturers while enabling select POS equipment upgrades without total replacement.
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.
NRF Contact: Richard Mader 202-744-8217 maderr@nrf.com
NRF Contact: Matthew Shay 202-783-7971 shaym@nrf.com
ARTS XML The ARTS XML Committee develops standard XML schemas and message sets that are used to facilitate – and lower the cost of – integration of applications in the retail enterprise. Participation is limited to ARTS members, although both retailers and vendors may participate.
Board of Directors The NRF Board of Directors is the governing body that oversees the activities of the Federation.
NRF Contact: Richard Mader 202-744-8217 maderr@nrf.com
ARTS Data Model Committee This committee shapes the future of the ARTS Data Model. Members propose enhancements, prioritize activities and approve all changes to the Model. NRF Contact: Richard Mader 202-744-8217 maderr@nrf.com
ARTS Standard RFPs Through this committee, NRF and ARTS are developing a library of standard RFPs to assist retailers in selecting the “right” software applications for their specific business practices.
Associate Member Advisory Council (AMAC) This council of Associate Member companies meets annually and via conference call to ensure the needs of NRF’s growing associate member base are met, and to provide feedback to NRF regarding the needs of retailers and how NRF can better meet those needs. NRF Contact: Mike Gatti 202-783-7971 gattim@nrf.com
NRF Contact: Richard Mader 202-744-8217 maderr@nrf.com
NRF Contact: Matthew Shay 202-783-7971 shaym@nrf.com
CIO Council This is 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. NRF Contact: Dave Hogan 202-783-7971 hogand@nrf.com
Committee on Employment Law This committee serves as NRF’s technical committee on labor law and employee relations matters, and is comprised of retail industry corporate executives and independent labor counsel, as well as human resource and employee relations executives from NRF member companies and associations. NRF Contact: Rob Green 202-783-7971 greenr@nrf.com
42
National Retail Federation
2010 Annual Report
Compensation Committee NRF’s Compensation Committee was created principally to review the salary and benefits of NRF’s President and CEO in keeping with best practices adopted by many retailers in today’s business environment. NRF Contact: Matthew Shay 202-783-7971 shaym@nrf.com
Credit Executives Committee 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. NRF Contact: Mallory Duncan 202-626-8106 duncanm@nrf.com
European Retail Technology Council This Committee, made up of many of Europe’s most prominent retail IT Directors and CIOs, offers a valuable networking opportunity while also coordinating NRF and ARTS IT activities and guiding ARTS activities in Europe. NRF Contact: Dave Hogan 202-783-7971 hogand@nrf.com
Executive Committee The purpose of the NRF Executive Committee is to serve as a sounding board for management, to tackle corporate governance issues and to discuss strategic matters in depth that affect NRF’s long term health and direction before presentation to the full Board for discussion and approval. NRF Contact: Matthew Shay 202-783-7971 shaym@nrf.com
Finance Committee This committee is elected by the Board of Directors and is one of three standing committees of the Board. It oversees the finances of the Federation including reviewing and recommending the Federation’s budget to the Executive Committee and the Board of Directors. NRF Contact: Carleen Kohut 202-783-7971 kohutc@nrf.com
Lovro Mandac CEO GALERIA Kaufhof GmbH. (Member Since 1999)
NRF provides a truly global forum for staying connected to what is happening in the industry in all areas of the business. It is a great source of contacts, expertise and ideas. NRF is also among the organisations which have international reach, a must in today’s retail world.
Financial Executives Council (FEC) The FEC is comprised of senior financial executives of NRF member companies who work with NRF to develop industry financial benchmarks and serve as advisors for industry advocacy efforts with the FASB, SEC, etc. NRF Contact: Carleen Kohut 202-783-7971 kohutc@nrf.com
Forum for International Retail Association Executives The FIRAE seeks to promote the free exchange of information among retail trade associations around the world and works to identify opportunities for cooperation in research and education. NRF Contact: Steven Glover 202-783-7971 glovers@nrf.com
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. NRF Contact: Mallory Duncan 202-783-7971 duncanm@nrf.com
Gift Card Working Group This working group addresses the rapidly spreading restrictions on the highly popular gift cards offered by many retailers. NRF Contact: Maureen Riehl 202-783-7971 riehlm@nrf.com
Government Affairs Policy Council The NRF Government Affairs Policy Council is the Federation’s principal policy making body on federal legislative and regulatory issues. NRF Contact: Mallory Duncan 202-783-7971 duncanm@nrf.com
Health & Employee Benefits Committee This committee consists of retail benefits managers and directors who provide technical input on a wide range of health, pension and other benefit issues. NRF Contact: Neil Trautwein 202-783-7971 trautweinn@nrf.com
Human Resources Executives Council This committee of senior human resources executives examines a wide variety of HR issues including compensation and benefits, technology issues that impact HR, diversity, succession planning, training, and more. NRF Contact: Dan Butler 202-783-7971 butlerd@nrf.com
ID Theft Working Group
General Counsels Forum
100 Years of Leadership
www.nrf.com
43
NRF NRF 100 100
ADVOCACY
This working group was created as a result of the Choice Point and Bank of America security breaches, concerns over identity theft [the safety of personally identifiable information (PII)] and the ways in which PII is used by the business community.
This subcommittee of the ITAC provides guidance and technical expertise on customs and trade facilitation issues affecting retailers as well as relations between the Bureau of Customs and Border Protection and the importing community.
NRF Contact: Mallory Duncan 202-783-7971 duncanm@nrf.com
NRF Contact: Erik Autor 202-783-7971 autore@nrf.com
Internal Audit and Compliance Council This council is comprised of senior internal auditors of NRF member com panies. These executives develop and exchange best practices for ensuring effective internal controls and maximizing the effectiveness of the operation, which is accomplished by meeting semi-annually and holding conference calls. NRF Contact: Rachel Ryan 202-783-7971 ryanr@nrf.com
International Trade Advisory Committee ITAC members include senior retail sourcing, compliance, and government relations executives and general counsels responsible for international trade, customs, and international labor issues for their companies both on the legislative and regulatory fronts. ITAC plays a key role in representing the industry’s interests to eliminate U.S. and foreign trade barriers and facilitating trade. NRF Contact: Erik Autor 202-783-7971 autore@nrf.com
IT Audit Council NRF’s IT Audit Working Group is comprised of senior IT Auditors of NRF retail member companies. NRF Contact: Rachel Ryan 202-783-7971 ryanr@nrf.com
ITAC – Food Products
My family has been in retailing for almost 100 years. The landscape is constantly changing as we face new opportunities to re-orchestrate how we do business. The NRF is an excellent incubator of this thought process...everyday we learn from our peers and the industry innovators.
Ron Sacino CEO Sacino’s Formalwear & Fine Dry Cleaning (Member Since 1993)
Subcommittee (NCCR) This subcommittee of the ITAC provides guidance and technical expertise on agricultural trade issues that specifically affect food retailers and chain restaurants. NRF Contact: Erik Autor 202-783-7971 autore@nrf.com
ITAC – Hardgoods Subcommittee This subcommittee of the ITAC provides guidance and technical expertise on trade issues that specifically affect retailers of consumer products other than textiles and apparel. NRF Contact: Erik Autor 202-783-7971 autore@nrf.com
ITAC – Softgoods Subcommittee
ITAC – Customs Subcommittee
This subcommittee of the ITAC provides guidance and technical expertise on trade issues that specifically affect textiles and apparel retailers. NRF Contact: Erik Autor 202-783-7971 autore@nrf.com
ITAC – Supplier Compliance Subcommittee This subcommittee of the ITAC formulates the industry’s response to concerns involving working conditions in U.S. and international manufacturing operations and other ethical sourcing and corporate social responsibility issues. NRF Contact: Erik Autor 202-783-7971 autore@nrf.com
ITAC – Trade Remedies This subcommittee of the ITAC provides guidance, technical and legal expertise on antidumping, countervailing duty, safeguards, as well as other trade remedies actions affecting consumer goods. NRF Contact: Erik Autor 202-783-7971 autore@nrf.com
Loss Prevention Advisory Council This council, composed of senior loss prevention executives from diverse retail sectors, meets frequently to discuss common problems confronting the retail industry and to share new ideas on product and program results. NRF Contact: Angélica Rodríguez 202-626-8142 rodrigueza@nrf.com
LP – Awards and Recognition Committee The Awards and Recognition Committee develops initiatives to honor and recognize law enforcement professionals/agencies and loss prevention/asset protection professionals. NRF Contact: Angélica Rodríguez 202-626-8142 rodrigueza@nrf.com
LP – Diversity Committee 44
National Retail Federation
2010 Annual Report
NRF and Divisional Committees, Councils and Task Forces The Diversity Committee was developed to promote inclusion and diversification in the loss prevention industry. NRF Contact: Angélica Rodríguez 202-626-8142 rodrigueza@nrf.com
LP – Conference Planning Committee The Conference Planning Committee works to develop topics and content for the NRF annual loss prevention conference. NRF Contact: Angélica Rodríguez 202-626-8142 rodrigueza@nrf.com
LP – Homeland Security Committee The Homeland Security Committee was created to provide loss prevention professionals expedited access to critical information on weather emergencies, man made crises like active shooters and terrorist attacks as well as other updates on Homeland Security. NRF Contact: Joseph LaRocca 202-783-7971 laroccaj@nrf.com
LP – Investigator’s Network This group of over 1,250 loss prevention professionals and federal, state and local law enforcement officials serves as a first alert network to share information about criminal activity affecting retail. NRF Contact: Ron Akins 202-661-3040 akinsr@nrf.com
LP – Joint Organized Retail Crime Task Force The Joint Organized Retail Crime Task Force (JORCTF) has a primary focus of developing standard training and awareness programs for retail loss prevention professionals and law enforcement officers. NRF Contact: Joseph LaRocca 202-783-7971 laroccaj@nrf.com
Committee
This group was developed to help identify and establish LP priorities and to set the legislative agenda of the LP community. In addition, this subcommittee compiles statistics and anecdotal information as background for potential congressional testimony.
This is an invitation-only committee comprised of regulatory affairs executives tasked with monitoring animal welfare activism, on-farm audits, and animal handling standards in the chain restaurant industry.
NRF Contact: Joseph LaRocca 202-783-7971 laroccaj@nrf.com
NRF Contact: Jack Whipple 202-783-7971 whipplej@nrf.com
LP –LERPnet Committee This group is reponsible for the governance of LERPnet and identifying new features and functionality in the system.
NCCR Board of Directors The NCCR Board of Directors is the governing body that oversees the activities of the National Council of Chain Restaurants.
NRF Contact: Angélica Rodríguez 202-626-8142 rodrigueza@nrf.com
NRF Contact: Jack Whipple 202-783-7971 whipplej@nrf.com
LP – Women in Loss Prevention Caucus This subcommittee of the Loss Prevention Advisory Council meets annually and by conference call quarterly to discuss the issues that women face in advancing their careers in retail loss prevention.
NCCR Employment / HR Group This special interest group of chain restaurant human resource executives meets in conjunction with the NRF Human Resource Executives Council (HREC).
NRF Contact: Angélica Rodríguez 202-626-8142 rodrigueza@nrf.com
LP – Education and Research Committee This group of industry professionals was assembled to explore and network with universities and certifications related to the loss prevention field. NRF Contact: Angélica Rodríguez 202-626-8142 rodrigueza@nrf.com
NRF Contact: Scott Vinson 202-783-7971 vinsons@nrf.com
NCCR Food Products Subcommittee This subcommittee of the NRF International Trade Advisory Council provides guidance and technical expertise on agricultural trade issues that specifically affect food retailers and chain restaurants. NRF Contact: Scott Vinson 202-783-7971 vinsons@nrf.com
NCCR Food Safety Task Force LP – Benchmarking Committee The Research Committee spearheads the annual Organized Retail Crime and Return Fraud Surveys, along with benchmarks and white papers. NRF Contact: Angélica Rodríguez (202) 626-8142 rodrigueza@nrf.com
LP – Legislative Committee NCCR Animal Welfare Steering
100 Years of Leadership
www.nrf.com
45
NRF NRF 100 100
ADVOCACY
This task force is comprised of designated representatives from NCCR member food service companies, normally quality assurance, food safety or technical service staff.
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.
NRF Contact: Jack Whipple 202-783-7971 whipplej@nrf.com
NRF Contact: Jonathan Gold 202-626-8193 goldj@nrf.com
NRF Foundation Board of Directors This Board of Directors, made up of senior 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.
Privacy Committee The Privacy Committee is composed of senior retail representatives with responsibility for aspects of company operations that affect customer and employee privacy.
NRF Contact: Kathy Mance 202-783-7971 mancek@nrf.com
NRFF Education and Advancement Committee Retail industry experts are invited to join this group to advise NRFF on activities involving skill standards, assessment and certification, curriculum and training materials, development of career tracks for distance learning programs and career/industry awareness activities and youth recruitment. NRF Contact: Kathy Mance 202-783-7971 mancek@nrf.com
Payment Systems Task Force This Task Force meets as needed to discuss matters pertaining to card acceptance and issues pertaining to retailer relationships with the credit and debit card associations and card acceptance networks.
NRF Contact: Mallory Duncan 202-783-7971 duncanm@nrf.com
Product Safety Committee This committee 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. NRF Contact: Jonathan Gold 202-626-8193 goldj@nrf.com
RAMA Awards Committee Responsible for the RACie Awards night, this committee works together throughout the year to develop every aspect of the evening, including the entry form, the judging process and the awards night presentation. NRF Contact: Kelly Gilmore 217-546-7110 gilmorek@rama-nrf.com
RAMA Board of Directors
NRF Contact: Mallory Duncan 202-783-7971 duncanm@nrf.com
Postal Working Group
The RAMA Board of Directors provides overall direction and leadership in the retail marketing community. Comprised of both senior level retail marketing executives and industry partners, the RAMA Board of Directors addresses critical issues facing retail marketers and works together to bring solutions to the challenges they face. NRF Contact: Mike Gatti 202-626-8117 gattim@nrf.com
RAMA Executive Committee The RAMA Executive Committee, comprised of senior level retail marketing executives, is responsible for identifying research, education and information needs of retail marketers and advertisers. They review and provide input and direction on various programs and participate in RAMA’s annual CMO Summit. The Chairman of the Board of Directors presides over the RAMA Executive Committee. NRF Contact: Mike Gatti 202-626-8117 gattim@nrf.com
RAMA Programming Committee This committee is responsible for selecting relevant and exciting programming for the Main Stage and Break Out sessions for the Retail Advertising Conference. NRF Contact: Kelly Gilmore 217-546-7110 gilmorek@rama-nrf.com
RAMA Networking Committee This committee is responsible for increasing the value of attending RAMA events, as well as for creating new networking opportunities for conference attendees. In addition this committee reaches out to RAC first time attendees pre-and post-conference, as well as during the conference. NRF Contact: Kelly Gilmore 217-546-7110 gilmorek@rama-nrf.com
RAMA Research Committee
46
National Retail Federation
2010 Annual Report
NRF and Divisional Committees, Councils and Task Forces Focusing on research development for RAMA, this committee works to identify and answer leading key consumer and marketer questions. NRF Contact: Kelly Gilmore 217-546-7110 gilmorek@rama-nrf.com
Real Estate Executives Council This council is comprised of the most senior-level real estate executives of NRF retail member companies to explore changes and developments in the marketplace. NRF Contact: Carleen Kohut 202-783-7971 kohutc@nrf.com
State Association Council SAC membership comprises the state retail associations that are most active in protecting their members’ interests in both the state and national public policy arena. NRF Contact: Maureen Riehl 202-783-7971 riehlm@nrf.com
Strategic Supply Chain Council This working group of the ITAC and the NRF Loss Prevention Committee includes senior retail executives responsible for global supply chain, transportation, and logistics. The SSCC provides guidance and technical expertise on issues affecting retailers’ management and security of their international supply chains, with a focus on public policy, technology, supply chain management tools and best practices. NRF Contact: Jonathan Gold 202-626-8193 goldj@nrf.com
The Sustainable Retailing Consortium brings together retailers, manufacturers, vendors, and organizations that are engaged in sustainable (green) retailing efforts. NRF Contact: Dan Butler 202-783-7971 butlerd@nrf.com
Tax – Streamlined Sales Tax Working I have attended NRF Taxation Committee Meetings for over 15 years. Each meeting of this dynamic committee brings relevant new information and valuable opportunities to discuss issues with other retailers. Over the years, NRF has successfully brought about many changes to the tax laws, to better serve the interests of retailers. My company has greatly benefitted from its membership in this organization.
Joan Korzek-Brown VP Tax Audits/Risk Mgt. Director The TJX Companies, Inc. (Member Since 1994)
Group This group is a combination of tax and government affairs experts working in tandem with the state retail associations and governments to modernize and simplify state sales tax systems in the U.S. NRF Contact: Maureen Riehl 202-783-7971 riehlm@nrf.com
Tax – WOTC Working Group
This working group 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 Contact: Rachelle Bernstein 202-783-7971 Bernsteinr@nrf.com
Tax Reform Working Group The NRF’s Tax Reform Working Group examines various tax reform alternatives under consideration by the President’s Advisory Panel and Congress with respect to their impact on retailers. NRF Contact: Rachelle Bernstein 202-783-7971 bernsteinr@nrf.com
TAX – Private Label Task Force The task force is comprised of tax executives from NRF member companies with concerns over IRS attempts to classify retailers as producers when they contract with third parties to produce private label goods for sale in the retailers’ stores. NRF Contact: Rachelle Bernstein 202-783-7971 bernsteinr@nrf.com
Taxation Committee This committee is comprised of senior tax executives of NRF retail member companies. The committee examines tax legislative and regulatory policies that affect retailers and recommends policy positions for the NRF to try to achieve through their lobbying efforts. NRF Contact: Rachelle Bernstein 202-783-7971 bernsteinr@nrf.com
Sustainable Retailing Consortium
100 Years of Leadership
www.nrf.com
47
NRF 100
ADVOCACY
Financial Overview
T
he recession of the last several years put extraordinary pressure on our industry and all those who serve it. While NRF was not immune to those pressures, our solid financial health enabled us to deliver uninterrupted service to our members and the industry during those turbulent times. Our Board concurred that serving the membership was our most important goal and was an appropriate and strategic use of reserves. We entered 2010 with cautious optimism. We had earned $2.6 million in net revenues with our events rebounding and the stock market strengthening. Our balance sheet was strong with over $23 million in cash and investments. An enthusiastic Board of Directors and management team bode well for our members and NRF. This financial strength and engaged leadership enabled us to demonstrably expand our advocacy initiatives and invest in several new member programs. The response was overwhelmingly favorable with record breaking attendance and vendor support at all of our major events and excellent member retention and recruitment. Our investments in research and coalition building around key issues, including value added tax and interchange, enabled us to prevent costly and burdensome legislation on our industry.
For every $1 of dues collected
Members receive $3 worth of services
We are well positioned for the coming year. We expect our operations to generate significant funding that we will invest in key priorities. We remain committed to managing NRF with a financially sound and strategically focused hand so that we continue to deliver for our members for the next 100 years. The future is indeed bright. Matthew Shay President & CEO National Retail Federation
48
National Retail Federation
2010 Annual Report
COVER PHOTOS (clockwise from upper left corner): Tory A. Burch, Founder and Creative Director, Tory Burch Allen Questrom, former CEO, JCPenney and Federated Department Stores Roger Farah, President and CEO, Polo Ralph Lauren House Speaker, John Boehner (R-OH) Kip Tindell, Chairman and CEO, Container Store and Tony Hsieh, CEO, Zappos U.S. Senator Mitch McConnell (R-KY), Senate Republican Leader Stephen Sadove, Chairman and CEO, Saks Inc. Bert Jacobs, Founder, Life is Good Mindy Grossman, CEO, HSN U.S. Representative James Clyburn (D-SC), Assistant Democratic Leader U.S. Senator Dick Durbin (D-IL), Democratic Whip Terry Lundgren, Chairman, President and CEO, Macy’s, Inc. and Chairman, National Retail Federation and Matthew Shay, President and CEO, National Retail Federation
CELEBRATING
100 YEARS OF LEADERSHIP
325 7th Street NW, Suite 1100, Washington, DC 20004 (202) 783-7971 Fax (202) 737-2849 www.nrf.com
2011 ANNUAL REPORT