Bluefly.com Net Sales Decrease by Approximately 5% in October; Resolution of Many Post-Launch New Site Problems Led To Improvement In Second Half of Month.Business Editors NEW YORK--(BUSINESS WIRE)--Nov. 15, 2002 Bluefly, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on SmallCap: BFLY BFLY Bluefly Inc. (stock symbol) ), a leading Internet retailer of designer brands at discount prices (www.bluefly.com), announced today that its net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight for the month of October 2002 decreased by approximately 5% to approximately $2.5 million from approximately $2.7 million for October 2001. On September 15, 2002, the Company launched a new version of its Web site based on a new technology platform. The Company believes that the decrease in net sales it experienced in October is primarily the result of the technical problems and inefficiencies the Company experienced after it launched the new Web site. Immediately after the launch of the new Web site and continuing through the first two weeks of October 2002, the Company experienced significant technical difficulties, including site instability, slower than usual page download times, and a failure to display all available inventory on the site. Many of these technical issues were resolved in the second half of October. As the Company worked through these technical issues, it saw its sales increase. By way of comparison, gross sales Gross Sales A measure of overall sales that isn't adjusted for customer discounts or returns, calculated simply by adding all sales invoices, and not including operating expenses, cost of goods sold, payment of taxes, or any other charge. in the second half of October 2002 were approximately 25% higher than gross sales for the first half of the month. Of course, there can be no assurance that this favorable trend will continue. The decrease in net sales is also partially attributable to an approximately 500 basis point increase in the reserve, which the Company uses to account for anticipated returns. The Company believes that the increase in return rate is primarily the result of an increase in the average order size, which on balance the Company believes had a positive impact on the per order economics. Bluefly may release monthly sales or other financial data from time to time, but the release of any such monthly data should not imply any undertaking to do so on a monthly basis. About Bluefly, Inc. Bluefly, Inc. (NASDAQ SmallCap: BFLY) operates the world's first full service outlet store An outlet store or factory outlet is a retail store in which manufacturers sell their stock directly to the public through their own branded stores. The stores can be can be brick and mortar or online. for designer fashion, offering products from more than 350 designers at discounts of up to 75%. With 24/7 access, a 90-day money back guarantee, and technology that displays real-time inventory, Bluefly makes off-price shopping easy and convenient. Bluefly is headquartered at 42 West 39th Street in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. , in the heart of the Fashion District. For more information, please call 212-944-8000 or visit www.bluefly.com. This press release may include statements that constitute "forward-looking" statements, usually containing the words "believe", "project", "expect", or similar expressions. These statements are made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. The risks and uncertainties are detailed from time to time in reports filed by the company with the Securities and Exchange Commission, including Forms 8-A, 8-K, 10-Q, and 10-K. These risks and uncertainties include, but are not limited to, the following: risks and uncertainties associated with the Company's recent launch of a new version of its web site, including new internal procedures that need to be developed to operate the new web site, site instability and download performance issues; the Company's limited working capital, need for additional capital and potential inability to raise such capital; potential dilution potential dilution The decrease in the proportional equity position of a share of stock that will occur eventually if additional authorized shares are actually issued. arising from future equity financings, including potential dilution as a result of the anti-dilution provisions contained in the Company's Series B Preferred Stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. and the Series C Preferred Stock; the competitive nature of the business and the potential for competitors with greater resources to enter such business; adverse trends in the retail apparel market; recent losses and anticipated future losses; the risk that favorable trends in sales, repeat customer sales, gross profit, gross margin and reduced selling, marketing and fulfillment expenses and reductions in operating losses will not continue; risks that the Company will be unable to reduce the levels of losses; potential adverse effects on gross margin resulting from mark downs and allowances; risks of litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. for sale of unauthentic or damaged goods DAMAGED GOODS. In the language of the customs, are goods subject to duties, which have received some injury either in the voyage home, or while bonded in warehouses. See Abatement, merc. law. and litigation risks related to sales in foreign countries; the dependence on third parties and certain relationships for certain services, including the Company's dependence on United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. Postal Service and U.P.S. (and the risks of a mail slowdown due to terrorist activity) and the Company's dependence on its third-party web hosting and fulfillment centers; risks related to consumer acceptance of the Internet as a medium for purchasing apparel; the successful hiring and retaining of personnel; the dependence on continued growth of online commerce; rapid technological change; online commerce security risks; the startup nature of the Internet business; governmental regulation and legal uncertainties; management of potential growth; and unexpected changes in fashion trends. |
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