1050377--3/14/2008--PC_CONNECTION

related topics

{customer, product, revenue}

{product, market, service}

{system, service, information}

{regulation, government, change}

{personnel, key, retain}

{cost, regulation, environmental}

{stock, price, operating}

{tax, income, asset}

{competitive, industry, competition}

{operation, international, foreign}

We have experienced variability in sales, and there is no assurance that we will be able to maintain profitable operations. We are exposed to inventory obsolescence due to the rapid technological changes occurring in the personal computer industry. We acquire products for resale from a limited number of vendors. The loss of any one of these vendors could have a material adverse effect on our business. We may experience a reduction in the incentive programs offered to us by our vendors. The failure to comply with our public sector contracts could result in, among other things, fines or liabilities. We face many competitive risks. We face and will continue to face significant price competition. The methods of distributing personal computers and related products are changing, and such changes may negatively impact us and our business. We could experience system failures which would interfere with our ability to process orders. We rely on the continued development of electronic commerce and Internet infrastructure development. We depend heavily on third-party shippers to deliver our products to customers. We may experience potential increases in shipping, paper, and postage costs, which may adversely affect our business if we are not able to pass such increases on to our customers. Privacy concerns with respect to list development and maintenance may materially adversely affect our business. We face many uncertainties relating to the collection of state sales and use tax. We are dependent on key personnel. We are controlled by two principal stockholders.

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1050377--3/14/2008--PC_CONNECTION_INC