We are also committed to expanding our highly successful electronic commerce platform as a means of strengthening our competitive position and pursuing new business, both domestically and internationally. The Internet offers customers a high-service means of ordering that provides significant cost savings to us and our customers over basic phone or fax orders. We have seized this advantage by building a series of Web-based capabilities, each customized to the needs of a particular user group.

The Office Depot business-to-business Web site is a fast, simple and direct link for more than 40,000 major business customers to real-time inventory and order status data on more than 11,000 of our products, 24 hours a day. We secure customer access through unique user identification standards and passwords. We also provide direct server-to-server connections, and we enable our customers to build their own unique electronic profiles, which include such information as to their specific requisitioning requirements and pricing.

Our domestic public Web sites, located at www.officedepot.com and www.vikingop.com, provide individual customers with an array of timesaving capabilities, such as real-time inventory, address and payment authorization, access to and status of previous orders, flexible delivery and returns, special speed features and cross-selling product suggestions.

One such feature is the Office Solutions section, which includes articles on topics important to small businesses such as “Getting Organized” and “Tax Time.” In the future, we plan to improve and expand our Internet capabilities to support increased customer satisfaction and fuel our continuing growth. Through strategic partnerships with a host of Internet and business-to-business service providers, we will greatly expand the range of services and products available through our electronic commerce sites.

Office Depot has also invested in a number of its Internet related strategic partners. One of those companies, PurchasePro.com, Inc., completed a very successful initial public stock offering in 1999, significantly increasing the value of Office Depot’s investment.