Q: Other retailers and the vendor community continue to talk about being more disciplined in managing their inventories. How will this affect the Company’s ability to source product?

A: The question of whether there are enough goods available to meet the needs of our growing Company has been asked of us throughout our history, since we opened our first store. The issue of more disciplined inventory management among the retailing and vendor communities represents the most recent iteration of the availability of goods question. The answer remains the same — there continues to be more than enough merchandise available and we are confident that this will be true in the future. For TJX, the question is not whether there is merchandise available; rather, the questions we ask ourselves are ‘what product to buy,’ ‘what product not to buy,’ and ‘what price to pay for the product we buy.’ For example, one of the reasons we launched our A.J. Wright concept in 1998 was to take advantage of the abundant buys in moderate brands that we had been passing on for years because they did not match the profile of our Marmaxx merchandise mix.

We have literally thousands of vendors with whom we have close business relationships and are establishing new ones every day. Within our vendor base of over 10,000, there are approximately 25 who comprise our top sources for product from one year to the next, but this group constitutes only approximately one quarter of the total product we buy. Unlike many retailers, in our off-price concepts, we do not build permanent departments to any particular vendors in our stores. Our selling floor space is flexible and free of expensive fixtures, so we can easily expand and contract departments. Our contract with our customers is to offer them great values on quality, brand-name apparel and home fashions, not to promise any particular brand. Our customers understand that they will find something new and different every time they shop our stores and love the ‘treasure hunt’ experience.

As the largest off-price retailer in the world, we have great opportunities in the vendor marketplace. When our buyers go into the marketplace, it is with a $16 billion buying pencil, which allows us to take advantage of the best opportunities. We take pride in our strong vendor relationships. Our vendors value our excellent credit rating and they trust that we are reliable and timely with our payments. Additionally, unlike others in the retailing industry, at our off-price concepts, we ask for no return, markdown or advertising allowances. Our straightforward approach goes a very long way in maintaining mutually beneficial business relationships.