SpartanNash Company (NASDAQ:SPTN) Q3 2023 Earnings Call Transcript

Rob Dickerson: Yes. It was more around the promotional activity and kind of visibility as we —

Tony Sarsam: Perfect. So yes, so that’s sort of core to the overall ECP and the merchandising work that our team has done. So we’ve had a really, really great run and great participation with our key suppliers. And we’ve seen a really nice turn around in terms of getting some great price points out there gaining some great promotional deals. And we’re roughly on track to deliver what we had forecasted early in the year in terms of the overall benefit to our shoppers and to our customers.

Jason Monaco: Yes, Rob. This is Jason. On the merge transformation, we were committed to $25 million to $35 million of benefit annually, we’re tracking well to that we’re right around $20 million year-to-date, and we expect to be right in the strike zone of that target by year end.

Rob Dickerson: All right. Super. And then maybe just quickly, on kind of channel dynamics, we’ve heard number of months, there seems to be fairly well documented, shift into, let’s say, certain kind of more math or clubs from dollar shopping occasions. I’m just curious kind of in your regions, and kind of on the wholesale part of the business. Have you kind of felt that to a certain extent, or do you feel like maybe so far, you’ve been a bit more inflated, just maybe given geographic locale? Thanks. That’s all.

Tony Sarsam: Yes. We’re seeing some of that. The numbers in our area don’t match up perfectly against the national numbers, we’re seeing — I can give you an example. So foot traffic overall, is down, it’s down across the board. Our foot traffic is, is down to kind of think about what — kind of 1% to 1.5% overall. And that’s roughly half of the foot traffic decline, we’re seeing most of our competitors at the same time. We are seeing shifts to deep discounters. If you’ve hinted out there, so some of the deep discounters are actually getting both better foot traffic and better sales in our area. And I think that’s strictly a function of people are settling in now and trying to find the best deals, and are certainly settling into the place where they can find them.

Also, we’ve mentioned that one element that has colored the overall performance of our businesses that pretty dramatic decline in EBT benefits for folks. And EBT was down, in the 40-ish percent range for us in the quarter versus last year, getting down kind of close to the pre-pandemic, again for in our mix and that’s had a big impact on our overall business.

Rob Dickerson: All right. Super. Thanks so much.

Jason Monaco: Building on Tony’s comments, Rob, I think there’s one other thing I mentioned, that I think is important to know is, when you think about foot traffic, taking that foot traffic and transforming it into revenue growth is really important. So when I kind of give you some color on our retail stores and our retail operations. As we’ve started to build out and transform our retail execution, some of the things we’re seeing are significant improvements in consumers pointing at SpartanNash is having the best meat, the best produce, the best local offerings. Those are all part of our retail strategy, and we’re seeing it play out in our results. So despite some of the challenges with the channel headwinds, our performance, as Tony alluded to is outperforming the market and foot traffic. And then, the work we’re doing in the store is beginning to transform the consumers experience and in our profile performance.

Operator: Our next question comes from Kelly Bania from BMO Capital Markets. Your line is open.

BenPham: Hi. Good morning, guys. This is Ben on for Kelly. Thank you for taking our questions. So to start, would you guys provide the inflation at wholesale and retail for the quarter? And then, can you provide just any color on the monthly cadence of sales inflation volume, just trying to get a sense of how volume is reacting to lower inflation? And if you guys are seeing any improvements there, either on the retail side or the wholesale side?