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Our information technology operations and infrastructure are built on the
premise of reliability and scalability. We maintain diesel generators and
uninterruptible power supply equipment to provide constant availability to
computer rooms, call centers and warehouses. Multiple Internet service providers
and redundant Web servers provide for a high degree of availability to Web sites
that interface with our systems. Capacity planning and upgrading is performed
regularly to allow for quick implementation of new clients and avoid
time-consuming infrastructure upgrades that could slow growth rates. We also
have a disaster recovery plan for our information systems and maintain a "hot
site" under contract with a major provider.
COMPETITION
Many companies offer, on an individual basis, one or more of the same
services we do, and we face competition from many different sources depending
upon the type and range of services requested by a potential client. Our
competitors include vertical outsourcers, which are companies that offer a
single function, such as call centers, public warehouses or credit card
processors, and many of these companies have greater capabilities than we do for
the function they provide. We also compete against transportation logistics
providers who offer product management functions as an ancillary service to
their primary transportation services. In many instances, our competition is the
in-house operations of our potential clients themselves. The in-house operations
departments of potential clients often believe that they can perform the same
services we do, while others are reluctant to outsource business functions which
involve direct customer contact. We cannot be certain that we will be able to
compete successfully against these or other competitors in the future.
Although many of our competitors can offer one or more of our services, we
believe our primary competitive advantage is our ability to offer a wide array
of services that cover a broad spectrum of electronic commerce transaction
management functions, including order processing and shipment, credit card
payment and customer service, thereby eliminating any need for our clients to
coordinate these services from different providers. We believe we are unique in
offering our clients a "virtual infrastructure" to handle all of their order
processing, customer care service, billing, information management and product
warehousing and distribution needs.
We also compete on the basis of certain additional factors, including:
- operating performance and reliability;
- ease of implementation and integration; and
- price.
We believe that we presently compete favorably with respect to each of
these factors. However, the market for our services is becoming more competitive
and still evolving, and we may not be able to compete successfully against
current and future competitors.
FACILITIES
In the U.S., we operate a nearly one million square foot central
distribution complex in Memphis, Tennessee. This complex is located
approximately four miles from the Memphis International Airport, where both
Federal Express and United Parcel Service operate large hub facilities. This
complex contains computerized sorting equipment, powered material handling
equipment, scanning and bar-coding systems and automated conveyors, in-line
scales and digital cameras to photograph shipment contents for automatic
accuracy checking. Our Memphis facility was recently showcased as the
Distribution Center of the Month by a leading trade journal for the distribution
and material handling industry.
Our receiving and material handling system in our Memphis distribution
complex includes several advanced technology enhancements, including radio
frequency technology in product
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