Dylan Carden: Kind of similar line of question a bit. I guess, I’m trying to think about the decline in gross margin over the years, 700 basis points, 600 basis points going back to 2015, 2016. Is that all best understood as an increase in promotion. And then can you quantify or even directionally sort of the margin drag from the retail channel kind of over that same period, you’ve seen productivity in your stores effectively have. Just taking those two things together to kind of think about how the new glide path back to above the line on profitability, if there’s a risk around kind of having your customers now so used to higher promotions, et cetera, et cetera, and sort of how you maybe get the retail chain back on some firmer footing.
Sam Sato: Go ahead.
Heena Agrawal: So on your long-term gross margin question, we’ve meaningfully advanced our sourcing and product development initiatives. And as I mentioned in my guidance, we are expecting 200 basis points of improvement, which will continue to build over the coming years and get back to our pre-pandemic levels in a few years. So we see a path forward to get back to those higher gross margins.
Dylan Carden: But is that can I stop you there — is that the promotional impact — I get the sourcing and the benefits that can do, but as far as how much you’re embedding as far as being able to get back to a higher price plan higher initial mark on whatever — however you want to quantify it relative to what was pre-period?
Heena Agrawal: For 2024, we are being prudent in our outlook and we are not assuming any AUR improvement in our guidance. But we are looking at what our seasonal performance is and how to optimize it and also how our new innovation can drive, position us to drive more full price sales.
Dylan Carden: Okay.
Heena Agrawal: So that’s one thing. And then on the store question, I’ve been able to visit several of our stores, which have a unique and engaging experience for the consumer. And they are part of our omnichannel strategy along with digital and mobile and they create an ecosystem where it helps us get to consumers and retain them. And so they are a critical part of our strategy going forward. All of our stores are cash flow positive. Having said that, we do have an opportunity to — in the context of the omnichannel environment, look at the size, the format, the depth of assortment to make them even more efficient and profitable. So we will be instituting more rigor as we think about new locations going forward.
Operator: This concludes our question-and-answer session. The conference has now also concluded. Thank you for attending today’s presentation, and you may now disconnect.
