Simeon Gutman: Hi, good morning, everyone. Hey, John, I wanted to ask you about newness. You’ve touched on it a bit in prepared and even in some of the Q&A, putting your design hat on and looking across your product. And it’s okay if you’re biased, but I am curious about trends, where your product stands in terms of style and price point. I heard you made some price adjustments. Just thinking about where it sits. And I know you also said like we’re not one design fits all. Can you talk about any specific trends, even within your product assortment, that rung faster than others?
John Reed: Sure. Yes, I’d love to. Yes. I mean, like I said before, I think we’re hitting on all cylinders on our products. It’s obviously the fun part of the business as consumers are looking for new looks, fresh looks for their homes, and we’ve gotten into a lot of products, especially in the wood categories that are brand new and upholstery categories where things have gotten softer, gotten rounder, curvier, woods have changed, they’ve warmed up a lot. They’ve gone away from the dark grays and so forth. That was so hot a few years ago. We saw those trends a few years ago and we’ve been all over it. And so yes, when we walk to our store and seeing our sales, it’s — the new product is really what’s getting our clients excited.
And so we continue to look at work on large collections that we’re going to launch and quite a few more in 2024. So as far as the new products as well, the margins are very strong on those. We’re setting them where we want to be. I don’t want to be, and I tell my buyers and so forth that let’s not be greedy on margin. Let’s get our margin where we can have a healthy business long-term, that we’re very profitable, but don’t get so greedy that we’re going to cut half the clients out. So we think our prices the way we buy things, direct from the manufacturers, right from the factories, right into our warehouse, and from there right to the consumer. You can’t get a better business model of giving clients the best value, us getting our great margins, but not being totally greedy on.
And it works. Customers are happy, they come back, they tell their friends, and our business keeps growing. So, yes, the trends are great. Again, things have gotten softer, curvier. Anything we’re doing that’s in those types of shapes are doing very well. And I foresee that to continue certainly into 2024 and 2025. Is that helpful?
Simeon Gutman: And then maybe one follow-up. Yes, that’s great. Thank you. My follow-up, I think it’s more for Dawn. It’s got two parts that are connected to some of the WMS and the disruption in the first quarter. Can you — the demand comps, I think were running positive at the end of last year. Correct me if I’m wrong. So I’m thinking about the anatomy of getting to this -20 or so that you’re putting — that you’re expecting for the first quarter, even with a negative high-single-digit in January. Meaning, why are — is it just comparison based? Why is there not enough throughput from the prior demand comps to get you to a better outcome? And then just related to this, you have this ERP rollout. Can you talk about that in terms of benefits and then any risks that could pose or with the WMS, the biggest hurdle in terms of systems investments that could have created some type of disruption to your business? Thank you.
Dawn Phillipson: Sure. So I would remind you that the demand comp has, that’s a clean calculation year-over-year from a comp basis. That is not a clean calculation year-over-year because the base of 2023 has backlog in it. So there’s still going to be a divergence between the demand comp and the comp number as we move through 2024 because of the backlog in 2023. Once we clear 2024 and we hit 2025, those two will be more in tandem. So there is still some disparity there. With regards to the ERP, I would just remind everyone it is our manufacturing ERP. So it’s not kind of the — it’s not the retail ERP. So it has a lesser impact on the overall organization when it comes to its not impacting deliveries, it’s not impacting kind of the retail organization’s day-to-day.
Some great benefits we’re going to have some increased visibility to costing, which is going to really give better visibility to the teams, the product teams as they’re costing product and just some other operational benefits to the actual manufacturing team. So no significant risk to the overall organization, I would say. We’re closely monitoring it, managing it, but it’s not meaningful from — no meaningful risk that we’re anticipating.
Simeon Gutman: Okay. Thanks, everyone. Good luck.
John Reed: Thank you.
Operator: Thank you. Our next question is from the line of Robbie Holmes with Bank of America. Please go ahead.
Unidentified Analyst: Hi, this is Maddie Chuck [ph] on for Robbie Holmes. Thanks for taking our questions. So I think you called out that showroom openings should be heaviest in 2Q, 3Q. And I just wanted to ask specifically on the outlets, you expect three openings this year. It’s still a pretty small part of the overall showroom count. But how is demand in response to these outlets? How do the economics compare to the traditional showrooms? And where you — how are you deciding where to put these?
