Distribution and Operations - QVC's distribution centers shipped an average of 456,000 units per day at QxH and 190,000 units per day at QVC International during 2021[48]. - QVC has made significant investments in its distribution centers to accommodate foreseeable growth needs[50]. - QVC utilizes computerized interactive voice response systems for telephonic orders, handling approximately 25% of all orders worldwide[48]. Seasonal Revenue - QVC's business is seasonal, with 30% to 32% of global revenue generated in the fourth quarter, compared to 21% to 24% in the first three quarters[60]. Competitive Landscape - QVC competes with major retailers like Amazon and Walmart, emphasizing high-quality products and exceptional customer service as key competitive factors[53]. - QVC faces competition from major retailers like Amazon and Walmart, which have a significantly greater web presence, impacting its market share[97]. Marketing and Customer Engagement - Zulily launched a variety of flash sales events that typically last for 72 hours, creating urgency for purchases[62]. - Cornerstone brands mailed approximately 163 million catalogs in 2021, varying by brand and marketing campaigns[74]. - Zulily's average item is offered at a significant discount off the manufacturer's suggested retail price, enhancing customer value[63]. - Zulily's technology investments focus on improving customer experience and optimizing business operations through data analytics[65]. Regulatory Compliance - The FCC has proposed to revise the definition of MVPD to include Internet-based services, which could require QVC to negotiate programming licenses with such MVPDs[81]. - QVC is subject to program carriage rules due to its attributable interests under FCC regulations, which prohibit coercing exclusive rights and favoring affiliated programmers[82]. - The 1992 Cable Act mandates that cable systems must carry local full-power commercial television broadcast signals, which may limit QVC's programming options[86]. - QVC may incur additional costs for closed captioning due to FCC regulations requiring substantial captioning for video programming[87]. - The company’s online commerce businesses must comply with various domestic and foreign laws, including the Children's Online Privacy Protection Act and the CAN-SPAM Act, which impose operational requirements and penalties for non-compliance[88][89]. - The enactment of the California Consumer Privacy Act and similar laws in other states may lead to substantial compliance costs for the company[92]. Employee Engagement and Well-being - As of December 31, 2021, the company had approximately 26,659 full and part-time employees, with employment levels fluctuating due to seasonal factors[100]. - The company is committed to Diversity, Equity, & Inclusion (DEI), focusing on representation, leadership accountability, and community impact[101]. - Annual employee engagement surveys are conducted to improve employee experience and retention, informing company programs and practices[102]. - The company has implemented health and safety measures due to COVID-19, including remote work for non-essential employees and enhanced on-site safety protocols[103]. - The company offers flexible hours and additional paid time off options to support employees during COVID-19 related absences[103]. - Employee Resource Groups have been launched to promote connections, career development, and community impact[101]. - The company provides access to mental health resources and has implemented special bonuses for employees during the pandemic[103]. Financial Overview - As of December 31, 2021, the company has $356 million in variable rate debt at a weighted average interest rate of 1.5% and $4.575 billion in fixed rate debt at a weighted average interest rate of 5.0%[339]. - Qurate Retail is exposed to foreign exchange rate fluctuations, with an estimated impact of approximately $6 million on Adjusted OIBDA for every 1% change in foreign currency exchange rates relative to the U.S. Dollar[339]. - The company has established policies and procedures to manage market risks associated with stock prices, interest rates, and foreign currency exchange rates[337]. - The company maintains a mix of fixed and variable rate debt to mitigate interest rate risk[339].
Qurate Retail(QRTEB) - 2021 Q4 - Annual Report