919443--3/9/2006--LACROSSE_FOOTWEAR_INC

related topics
{customer, product, revenue}
{product, market, service}
{condition, economic, financial}
{property, intellectual, protect}
{personnel, key, retain}
{operation, international, foreign}
{cost, regulation, environmental}
A decline in consumer spending due to unfavorable economic conditions could hinder our product revenues and earnings. We conduct a significant portion of our manufacturing activities outside the U.S., and therefore we are subject to the risks of international commerce. Because we depend on third party manufacturers, we face challenges in maintaining a timely supply of goods to meet sales demand, and we may experience delay or interruptions in our supply chain. Any shortfall or delay in the supply of our products may decrease our sales and have an adverse impact on our customer relationships. Failure to efficiently import foreign sourced products could result in decreased margins, cancelled orders and unanticipated inventory accumulation. Any major disruption at one of our two distribution facilities or our domestic manufacturing facility could prevent the timely delivery of our product. The continued consolidation of retailers, and the leveraged growth in the overall number of stores, increases and concentrates the Company s credit risk. Our financial success may be limited by the strength of our relationships with our retail customers and to the success of such retail customers. We face significant competition and if we are unable to compete effectively, sales of our products may decline and our business could be harmed. We may be unable to meet changing consumer preferences and demands. Changes in the price or availability of raw materials could disrupt our operations and adversely affect our financial results Our failure or inability to protect our intellectual property could significantly harm our competitive position and reduce future revenues. We depend on a limited number of suppliers for key production materials, and any disruption in the supply of such materials could interrupt product manufacturing and increase product costs. In order to be successful, we must retain and motivate key employees, and the failure to do so could have an adverse impact on our business.

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