Chris Pappas: Sure, Peter. I think we’ll start, I’ll start backwards and then I’ll let Jim opine a little bit on that. But yes, when we bought Chefs’ Middle East, we knew that they were going to be constrained on space. That was part of, how we, how we assessed the value. And it’s a great company. It throws off great free cash flow. And the plan was to use that, part of that money to fund the expansion. So I think that’s business as usual and that addition is already being built. We expect them to continue to grow and that business to continue to prosper. Greenleaf is a much different kind of acquisition. A company that we’ve known for over 15 years, great brand in San Francisco. It complements the way we go to market in San Francisco probably our second largest market right now when you combine all the businesses that we own in Northern California.
And that’s kind of, they run a great business and we’re just letting them continue to run it, with Chef integrating slowly. So again, we can get that crossover sell. They have a lot of clients that the other Chef companies don’t have. So we’re introducing. more and more products to those customers and vice versa and that’s kind of more of a steady eddy and hopefully continue to grow over the next 10 years as a great business. Hardee’s was an entry into Texas where we had a very small footprint, another great company, huge footprint throughout almost all of Texas. And that one I’d say we’re still in the first inning. We’re still, getting to know each other. We’re starting to integrate slowly management teams, accessing their customer base. We opened up Allen Brothers Texas over the past year.
So that plant is finally open and glad to say that. It’s doing better than expected. It’s starting to sell more and more premium Allen Brothers types proteins to the Chef to the CW customers as well as the Hardees customers. And the CW business, which is pretty small compared to our other markets, is starting to get lots of traction, opening up customers every single day, and starting to penetrate more and more of the Hardee’s customers. So it goes back to why we bought Hardee’s, right? To access Texas faster, it’s such a big state, and we’re very excited about the, the long-term growth of Texas.
Jim Leddy: And Pete, I’ll just add on the CapEx question and the guidance. So the project is underway. We’re already spending money on it. We’re funding it out of the cash flow that CME generates. The CapEx is in our current 2023 CapEx guidance and is also in the capital allocation plan that we announced earlier. And so — just wanted to comment on that.
Peter Saleh: Great. And then just a follow up, we’ve heard some evidence that maybe the higher end consumer, the higher income consumer is starting to trade down a little bit and manage their check to a certain degree with maybe cheaper entrees and cheaper alcohol. Are you guys seeing any evidence of that and your numbers? I mean, your sales numbers are pretty good. Just trying to see if there was any evidence that consumers are actually down?
Chris Pappas: Yes, I mean, we’re not in the alcohol business. So I don’t think we can really comment on that. What I’ve seen over the past almost 40 years is usually when the economy slows down some, people usually, I’d say the overall mass market probably drinks a little bit less expensively, right. But that’s why from the food side, historically, we could see a little bit. I mean, we probably saw a little bit over the summer. I think the summer was, very different than most summers. There’s so much, I say, travel, our customer’s customer. What we kept hearing was our customer is in Europe, right? So, we’re busy, we’re not as busy as we’d like. We had the smoke from Canada, which shut down a lot of the outdoor cafes which hurt us during the summer.
It was a thousand different things that were going on. We had lots of rain and then we had heat. So it was a really funky summer. And as we started coming into September, we started to see more, I would say normalization of sales. And then going into October, it came in strong. So from where we sit, we think business is pretty good. We think most of our customers are doing pretty well. We think the pipeline going into the fourth quarter looks good. We’re hearing about lots of parties, lots of bookings. So are people cutting back a little bit? Wouldn’t be so surprised, but I would say overall, our customers are doing pretty well.
Peter Saleh: Thank you.
Operator: The next question we have is from Todd Brooks of Benchmark Company. Please go ahead.
Todd Brooks: Hey, thanks for taking my questions. First, just Chris or Jim, on the growth algorithm for the next couple of years, part of getting the efficiencies out of these new facilities that you’ve added, you’ve talked about tuck-in acquisitions and how valuable they can be kind of building volume through this new capacity that you’ve added. If we think about that 4% to 6% organic growth and I think historically 5% to 10% from acquisition, does the new plan imply that we’re at the 5% end of growth through acquisition or do you see a period of digestion here where we may even be a little bit lower than 5% growth from acquisition?
Chris Pappas: Yes, that’s a tough one. As we know, things can change. I would say, again, in this kind of environment, we’re talking about today, we’re much more focused on digesting all the acquisitions that we’ve done the past, say, 24 months, and driving more revenue to the same customers and continuing to open customers and start to push volume into the new warehouses we built. Doesn’t mean we can’t do some really smart fold-ins that the volume adds to lowering our overhead into these new facilities and driving greater EBITDA to the bottom line. I think the message is more, right now, our job is to allocate capital and probably the best allocation of capital right now is to grow more organically. Unless there’s a phenomenal, phenomenal deal that makes unbelievable sense for us and our shareholders we would rather put the put the capital to work hiring more salespeople and really Pushing the organic growth which we’re really good at to drive mid to maybe high single digit growth organically.
