Jack Calandra: Yes. Well, I think we’re expecting an increased level of promotional activity certainly versus last year and Mitch, I think there’s a couple of factors there. One is we know that inventories in the industry are higher. We know that the consumer is — the consumer wallet is a bit more stretched than it was last year and so I think those two factors are inclining us to think that this is going to be a more promotional period. We also have versus last year our inventories, we had we had very little inventory last year because of some of the supply chain constraints. So for those reasons, we’re expecting, I think to get to a more normalized level of pricing and promotional activity in the quarter and that’s factored into our guidance.
Mitch Kummetz: And I guess final question just on the Famous margins, you mentioned that the gross margin there it’s up 370 Bps from Q3 ’19. So just maybe you kind of remind us some of the structural changes to the business that has allowed you to deliver that level of profitability and how sustainable you feel like those changes are?
Diane Sullivan: Well, let me start on that Mitch on some of the structural changes that I can really actually speak to it from a total company perspective and there’s a couple of probably most the biggest significant areas with the really in the margin rate assumptions across the company, both in for Famous and for Brand Portfolio, we really believe that we are going to be able not to maintain things at the high level at Famous in ’21, but somewhere between historical and those ’21 levels, which is you’re even seeing us do a little bit better than that today. So that’s one element. The Brand portfolio again, the margin improvement that we’re seeing now, getting much higher — high 30%, let’s hold 40% at some point in time, but that structural change has happened.
So the whole margin profile of the company because of how we’ve been able to price, the edits we’ve done a whole lot of other host of other things that really changed that. The second thing was we exited brands and we exited stores and that structural cost came out of our P&L as well. Interest expense was a bit different, share buyback, depreciation and amortization has been a big factor of it as well and then even corporate payroll. So when we look at all those pieces and add them up and we take a certain percentage, we don’t assume it’s all going to be better. It’s very, very clear to see that the materiality of that is going to be significant for us going forward with the most important, we look at this management of SG&A and expense on a day-to-day basis.
We took $100 million out a couple of years ago. We continuously look at that to make sure that we’re reallocating that spend in the right way, but the real one is going to be those margin rates and that’s going to be critical and that’s where I would say 80% of our focus is on making sure that that continues to be where it is today or better as we go forward. So, that — I think that’s what I’d say with respect to the structure for the entire enterprise. Is that helpful for you?
Mitch Kummetz: It is thanks and good luck for holiday.
Diane Sullivan: Thank you.
Operator: Ladies and gentlemen, our final question comes from line of Dana Telsey with Telsey Advisory Group. Please proceed with your question.
