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 business processes, including web
site design and hosting, kitting and assembly, order processing and shipment,
credit card payment and customer service, thereby eliminating any need for our
clients to coordinate these services from many different providers. We believe
we are unique in offering our clients a very broad range of business process
services that addresses, in many cases, the entire business transaction, from
demand to delivery.
We also compete on the basis of many other important additional factors,
including:
- operating performance and reliability;
- ease of implementation and integration;
- experience of the people required to successfully and efficiently design
and implement solutions;
- leading edge technology capabilities;
- global reach; 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.
EMPLOYEES
As of December 31, 2001, we had 575 full-time employees and 45 part-time
employees, of which 498 were located in the United States. We are not a party to
any collective bargaining agreements, and we have never suffered an interruption
of business as a result of a labor dispute. We consider our relationship with
our employees to be good.
Our success in recruiting, hiring and training large numbers of skilled
employees and obtaining large numbers of hourly employees during peak periods
for distribution and call center operations is critical to our ability to
provide high quality distribution and support services. Call center
representatives and distribution personnel receive feedback on their performance
on a regular basis and, as appropriate, are recognized for superior performance
or given additional training. Generally, our clients provide specific product
training for our customer service representatives and, in certain instances,
on-site client personnel to provide specific technical support. To maintain good
employee relations and to minimize employee turnover, we offer competitive pay,
hire primarily full-time employees who are eligible to receive a full range of
employee benefits, and provide employees with clear, visible career paths.
REGULATION
Our business may be affected by current and future governmental regulation,
both foreign and domestic. For example, the Internet Tax Freedom Act bars state
and local governments from imposing taxes on Internet access or that would
subject buyers and sellers of electronic commerce to taxation in multiple
states. This act is in effect through November 1, 2003. If legislation to extend
this act or similar legislation is not enacted, Internet access and sales across
the Internet may be subject to additional taxation by state and local
governments, thereby discouraging purchases over the Internet and adversely
affecting the market for our services.
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