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Our long term store real estate goal is to improve our stores’ sales productivity and profitability. We currently intend to close approximately 10 to 15 locations in 2014, primarily in North America. We also intend to strategically refresh and upgrade stores with select features from the new store design, while driving down the cost of capital required for these improvements. We also expect to open new locations selectively as opportunities arise. 

Non-traditional Store Locations:  As of December 28, 2013, we had one location each in a ballpark, a zoo, a science center and an airport. Additionally, we had three locations located within other retailers’ stores. We also operate temporary stores, which generally have lease terms of six to eighteen months and are excluded from our traditional store count. These locations are intended to capitalize on short-term opportunities in specific locations. As of December 28, 2013, we operated seven temporary stores. 

International Franchise Locations:  Our first franchisee location was opened in November 2003. All franchised stores have similar signage, store layout and merchandise characteristics to our company-owned stores. The number of international, franchised stores opened and closed for the periods presented below are summarized as follows: 

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As of December 28, 2013, we had 12 master franchise agreements, which typically grant franchise rights for a particular country or group of countries, covering an aggregate of 16 countries. The distribution of stores among these countries is as follows: 

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(1) Gulf States agreement includes Kuwait, Bahrain, Qatar, Oman and the United Arab Emirates 

In the ordinary course of business, we anticipate signing additional master franchise agreements in the future and terminating other such agreements. We believe there is a market potential for approximately 300 international stores outside of the United States, Canada, the United Kingdom and Ireland, which we expect to be operated primarily by new and existing franchisees. 

## Results of Operations 

## 2013 Overview 

Our 2013 performance demonstrated progress on our turnaround plan and our objective to achieve sustainable, profitable growth as we hired a new chief executive, executed a significant real estate strategy and implemented stringent cost controls throughout the organization. Our accomplishments included: 

• Consolidated comparable store sales increased by 5.1%, led by a 5.7% increase in North America; 

• Improved North American store productivity to $381 per square foot, a 9% increase, reversing a multi-year decline; and 

• We expanded retail gross margin and reduced selling, general and administrative expenses both in dollars and as a percent of revenue. 

In fiscal 2014, we expect to continue to build on these successes, reposition our marketing programs, including our loyalty program, and begin to lay the groundwork to further leverage the strength of our Build-A-Bear brand. 

The following table sets forth, for the periods indicated, selected statement of operations data expressed as a percentage of total revenues, except where otherwise indicated. Percentages will not total due to cost of merchandise sold being expressed as a percentage of net retail sales and commercial revenue and immaterial rounding: 

