Anthony Lebiedzinski : Thanks, Bob. And then, in terms of the guidance for Q3, is this mostly volume driven as far as the sales decline from last year. How should we think about pricing? I know it was a bit of a factor during Q2, but just overall, just wanted to get a better understanding as to how you are thinking about the volume versus pricing dynamics?
Bob Lucian: The pricing is pretty much in — we have pretty much lapped all the price increases that we’ve taken. There’s been some promotional opening price point sharpening and things like that, that we have done. We have seen some improvements in mix, and a combination of those things is how we are kind of thinking about the kind of year-over-year from a unit perspective, things are, I would say, flattish with some benefit from the mix of the business we have from a Retail versus Wholesale, as well as the mix of some of the products that we’re selling in the Retail segment.
Anthony Lebiedzinski : And then, as you called out, part of Century Vision strategy is to get to double-digit operating margins, you made some changes to your supply chain here as of this last quarter, staying agile as you like to say. So I mean, can you guys — do you think you can get back to a double-digit operating margins even if revenue will be below peak levels that you had in fiscal ’22?
Bob Lucian: Yes. Our plan will be to get our sales above those peak levels with all the work that we are doing from a Century Vision strategy perspective. That includes all the work we are doing on the retail side relative to acquisitions, new store openings and just continued execution that store to derive same-store sales. All the channel expansion strategy that we have got right now is delivering. We are getting into new customers and we are delivering incremental volume from that. So with all of those going on, and then eventually, we will see the consumer come back in and start shopping because the economy will get better, the housing market will improve, and people will start kind of — we will see the industry come back from that perspective.
A combination of all of those things will indicate that we are going to be over that, the peak that we hit during COVID. Question of when that’s going to happen, is a function of the macroeconomic environment. But we are working on all the things that we can work on to make that happen. And as we are doing that, we are doing a lot of work, particularly on the wholesale side to bring that business back up into the 10% margin area that it was pre-pandemic. We’re getting more efficient in our plants. We just took a decision relative to closing a facility, because of the productivity improvements we have seen in the U.S. plants, we were able to absorb all that volume into those plants. So it is not something that’s going to happen next quarter, but over time we are going to be continue to move that are Wholesale business up to that 10%.
And we will continue to execute well on the Retail side. And that’s the formula if you will for getting to the consistent double-digit margins.
Operator: [Operator Instructions]. Our next question is coming from Bobby Griffin of Raymond James.
Bobby Griffin : I guess Bob, I want to circle back on the restructuring and hopefully maybe we can unpack the changes a little bit more and then maybe talk about what do you think that opportunity can do to the wholesale margins? And then I guess as the second part of that question is when you look back versus pre pandemic, so not the prior — not the pandemic peak, but going back to call it like FY ’19, what are the biggest two or three drivers and the difference between wholesale being 10% and now wholesale being 7% or 8% margins?
Melinda Whittington : I’ll start, Bobby. If you look at what we did over the last three years when there was so much supply chain disruption, and then at one point we were at kind of a six-to-nine-month backlog. What we did is prioritize getting our consumers and our customers’ service. And as our production process is an artesian process. It’s people with hands putting together fabric and foam and steel and wood. And so we opened up quite a few leased facilities to essentially get the people and the processes in place to service that backlog. As the dust has settled now, that’s giving us the opportunity to look at that, get back to the blocking and tackling work that we’ve had for many years around being super productive, and get our existing plants back on track with less disruption.
So with that, enables us to start to, it’s never easy to be clear to close locations, right? Those that impacts people. But we’re making those tough choices and closing down some of those leased facilities and all, as the rest of our network kind of gets back to the excellent productivity levels that they’ve had in the past. So I think that that’s the biggest single piece is somewhat managing through the disruption now and then designing that footprint of the future that meets our consumer needs and our customer needs for the long term at the sort of strategic level.
