Tim Wojs: Hi guys. Good afternoon and good morning, or whatever it is.
Scott Culbreth: Great. Good morning, Tim.
Tim Wojs: Yes. Nice job. Maybe just a bigger picture kind of conceptual question. Just within your builder customers, I mean, is there any way to kind of think generally about what the runway there from a penetration perspective is? And I know it’s not uniform across the customers, but just maybe give us an idea of maybe where kind of generally wallet share is today and maybe what’s kind of possible over time?
Scott Culbreth: Yes. The first thing I’d say is that the builders that we’ve partnered with are taking share and will continue to take share. So the fact that we partnered with them just naturally leads to a better sell-through rate for our business. I think we’ve talked in the past that we do business with the vast majority of the top 20 national builders, but that doesn’t mean we have a position with each builder in each market. So the first thing our team always spends time focused on is, there are new opportunities, new markets that we can explore to try to get incremental share gains with a particular account, and that’s throughout that entire list of top 20 national builders. I don’t have an exact value to quote to you around the overall business.
We tend not to be a sole supplier except in limited cases. So our belief is we’ll continue to get share really with the vast majority of those builders. And again, they’re going to take share in the marketplace and have been demonstrating that certainly over the last couple of years.
Tim Wojs: Okay. Is there a way to think — how big is the national, kind of, top 20 relative to your total builder business or builder direct business?
Scott Culbreth: Maybe let me restate that. How much of our builder business goes to the top 20?
Tim Wojs: Yes, yes. Basically, I’m just trying to think about how much — if your builder business — how much of your builder business is going to the top 20 versus the other builders?
Scott Culbreth: Yes, not an exact percentage to give to you, but it would be a high percentage. I don’t know about that.
Tim Wojs: Okay. Okay. Okay, good. And then, I guess, from just a mix perspective, I mean, is there anything within the business from a mix perspective that has changed over the last 3 months to 6 months?
Scott Culbreth: No, nothing substantially changed on the mix side.
Tim Wojs: Okay. And then the last one, just on inflation and kind of deflation, thinking about fiscal ’24, it does seem like materials have kind of come down a little bit, whether that’s kind of plywood or particle board or maybe some of the hardwood. Do you model or kind of think about explicitly in fiscal ’24 seeing some material deflation?
Scott Culbreth: When we go and put together our budgets and plans to try to figure out an outlook to be able to share with the investment community, we look at a number of different scenarios, one that includes inflationary environment and one that also includes a deflationary environment. I’ll go back to the comments a few questions again though. So if we do see more deflation than modeled and assumed, there’s likely — it’s going to cascade and come our way on pricing, but we would view those as being offsetting. Similar to the uptick, right, when we saw inflation going up, you basically are going to gain pricing for those inflationary impacts. We had a lag on the front end. We’ll try to ensure there’s a similar lag on the down slope as well.
