BUSINESS SEGMENTS

12 Months Ended

Dec. 31, 2013

Segment Reporting [Abstract]

BUSINESS SEGMENTS

BUSINESS SEGMENTS

Segment information has been prepared in accordance with ASC Topic 280 Segment Reporting. Segments were determined based on how we manage the business. There were no inter-segment sales or transfers during the years ended December 31, 2013 and 2012. We evaluate the performance of our segments and allocate resources to them based primarily on gross profit. The table below summarizes information about reportable segments for the years ended December 31, 2013, 2012 and 2011 (in thousands):

	Year ended    December 31,
			Fulfillment
	Direct		partner		Total
2013
Revenue, net	$	156,032	$	1,148,185	$	1,304,217
Cost of goods sold	136,282		920,275		1,056,557
Gross profit	$	19,750	$	227,910	$	247,660
Operating expenses					(231,095		)
Other income (expense), net					(221		)
Provision (benefit) for income taxes					(72,165		)
Net income					$	88,509
2012
Revenue, net	$	155,516	$	943,773	$	1,099,289
Cost of goods sold	140,536		760,323		900,859
Gross profit	$	14,980	$	183,450	$	198,430
Operating expenses					(186,269		)
Other income, net					2,993
Provision for income taxes					485
Net income					$	14,669
2011
Revenue, net	$	163,609	$	890,668	$	1,054,277
Cost of goods sold	149,660		725,529		875,189
Gross profit	$	13,949	$	165,139	$	179,088
Operating expenses					(196,622		)
Other income (expense), net					(2,046		)
Provision (benefit) for income taxes					(142		)
Net loss					$	(19,438	)

The direct segment includes revenues, direct costs, and cost allocations associated with sales fulfilled from our warehouses. Costs for this segment include product costs, freight, warehousing and fulfillment costs, credit card fees and customer service costs.

The fulfillment partner segment includes revenues, direct costs and cost allocations associated with sales fulfilled from warehouses maintained by our fulfillment partners. Costs for this segment include product costs, outbound freight and fulfillment costs, credit card fees and customer service costs.

Assets have not been allocated between the segments for our internal management purposes and, as such, they are not presented here.

For the years ended December 31, 2013, 2012 and 2011, substantially all of our sales revenues were attributable to customers in the United States. At December 31, 2013 and December 31, 2012, substantially all of our fixed assets were located in the United States.