Chuck Grom: Yes, very smart. My follow-up question is just on the comp. I was wondering if you could maybe unpack the acceleration on a three-year basis from the second quarter to the third quarter, which it looks like it’s about 300 basis points, and then looking ahead, if you do, say, a 4.5% comp on the fourth quarter, that implies a real big drop sequentially relative to the third quarter, close to about 1,000 basis points. Just curious the decision factors behind that comp assumption for 4Q.
Bob Eddy: Yes, it’s a good question. Maybe I’ll start and Laura can pile on. We had a tremendous quarter, in our view, in the third quarter, far exceeding what we thought. There was a little bit of inflation, so inflation definitely ticked up 3Q over 2Q, not a tremendous amount but certainly was there. It was continued acceleration in our members’ purchasing behaviors. When we started this year, we thought 3Q would be negative comp, given what happened last year, and I mean that in sort of the EBT funding sense, the government stimulus sense and the behavior change we saw in 3Q last year was a dramatic pull forward of primarily our sundries business, but some of the rest of our grocery business as well. As we’ve gone through the year, one of the best things that we’ve seen is the increases in shopping behavior in all of our income cohorts, as I talked about earlier, but most notably at the bottom of the house.
In our past data, we have seen a great linkage between increases and decreases in federal EBT budgets and what those folks actually did, so in times where budgets contracted, their shopping behaviors contracted. We have not seen that this year, and as I said earlier, the sales per member and trips per member in each of our cohorts has gone up. I think that’s a tremendous story about value. I think we have convinced that lower end consumer of our proposition and they are using different dollars today than what they get from the government, because they believe our value story. They believe that we are saving them money and we are, so that I think is the real story behind the third quarter performance. It was over our expectations for sure. I don’t know that that slows down in 4Q, but as our competitors have noted and I talked about earlier, our GM performance was a little bit soft in the third quarter and you’ve got a tough market out there, and GM becomes a bigger piece of our business in the fourth quarter, so you’re absolutely correct – the guidance that we’ve got out there, comps in the 4% to 5% range for 4Q, would imply a decent decel.
I hope that doesn’t happen. We’ll see what we end up with. We’re certainly working hard to do what we can from our general merchandise business and we will capitalize on the great health of our grocery business. That business, we have no issues in. It’s comping quite nicely and our performance has been good here in the opening weeks of 4Q as well. A lot of that is market share, right? We’ve been gaining market share all year long, both in gas and in our grocery business, and I don’t see that slowing down at all. The other point I might throw out there which factored into our thinking, was we’re going to start lapping some of the inflation we saw last year, so you’re going to have a little bit of a base effect coming on in 4Q. But we are very bullish on our prospects in 4Q, I think we’ll do well, and hopefully do well in the next year as well.
