The company continued to expand internationally
in fiscal 1998. It is faced with competition in
European and Japanese markets from established
regional and national chains. If international expansion
is not successful, the company’s results of operations
could be adversely affected. The company’s ability to
grow successfully in the continental European markets
will depend in part on determining a sustainable profit
formula to build brand loyalty and gain market share in
the especially challenging retail environments of France
and Germany.