And quite frankly, it could dip another 1% because we’re making the decision to bring our cash back in by year-end and then redeploy that. We know that whatever margin we give up in the next 90 days, we will more than make that up in the following 180 to 270 days.
Brandon Rolle: Great. And then just on your industry wholesale side. What gives you confidence that dealers will want to take on inventory above retail levels in 2024, given current floor plan rates? I understand there’s been some destocking, but it seems like above a 1:1 ratio is a little tough in this environment?
Marcus Lemonis: Okay. I think when you look at overall inventory across the entire channel, we’re probably slightly under stock from where we need to be. But the key to that $370,000 number in our opinion and the manufacturers have already started to address this, and I include Thor, Winnebago and Forest River in that equation is understanding that ASPs need to be driven down. And the way you drive ASPs down is you drive actual cost of production down. There’s been a lot of discussion around that. And I want to be clear that both the dealers and the manufacturers aren’t going to just drive ASPs down by de-contenting. The customer, the consumer cannot be the loser in that equation, efficiency, proper forecasting, proper ordering, both on the raw material side and the dealers taking them is the key to that.
We also feel confident that our company sets the pace. And that’s really, really important. And we believe that we maybe necessarily contributed to the slowdown by saying to everybody, look, we see these trend lines moving. Matt runs regression analysis is all the time, and we can see where the things are going. We want to continue to be a bit of a bellwether for the overall industry. We’re telling everybody now, yes, rates are a little bit higher. Yes, it’s true that the consumer is more sluggish. But we also know that buying an RV and financing it anywhere from 180 to 240 months is still the most affordable alternative for families to take a vacation over any other activity they could provide. We just have to make it more affordable for them, and that’s on us to do that.
Brandon Rolle: Great. And just lastly, I know you said you wanted to take down pricing about 10% from where it is right now? I know you’ve had conversations with OEMs. What are they telling you about their conversations with suppliers? And who ultimately do you feel like needs to give back a little margin here to help out the industry? Thank you.
Matthew Wagner: Brandon, I feel like that’s a setup question. Where it’s a leading question, I should say. I think that the manufacturers have been exceedingly effective at towing that fine line of knowing that they need to protect their margins and they need to maintain healthy margins because they need to continue to innovate and grow, while at the same time, de-contenting products, however, not to the extent whereby consumers are going to be turned off by it. But finally, and most importantly, where I saw your question going, they need to put a tremendous amount of pressure on suppliers to ensure that we’re cleansing ourselves of products that could still be lingering from some suppliers well over 1.5 years, 2 years ago, which I think that’s unfortunately something that we need to work together between the suppliers, the manufacturers, OEMs and the dealers.
And we have to understand that the dealers were the first to feel the pain and pressure, us, in particular, the OEMs started to feel the pain of pressure after us about last year and now, frankly, just continues to go up this vertical supply chain. So I think the quicker that we reconcile whatever sort of lingering overpriced supplies exist out there in all these funnels, I think the better off will all be.
Marcus Lemonis: Let’s even dissect it a little bit more. When you look at the overall manufacturing process, you segment it into towables and motorhomes. And we know that on the motorhome side, it’s a bit of a tough road for motorhome manufacturers because they’re dealing with OEMs who are providing chassis who could potentially continue to drive up prices, having to deal with labor issues at UAW, all those things. The core meat of the market for our company, while we still are a big part of the motorhome business is on the towable side. And if you start to break it down and dissect how that product is made, it starts with the frame. And whether it’s the frame, whether it’s furniture, whether it’s slides, whether it’s appliances, those things that I just mentioned make up the bulk of the unit.
I think this industry needs to continue to diversify its sources of those products to ensure that there’s diversity in options for those manufacturers and whether manufacturers are starting up their own train business or there’s other entries into the market, we have to figure out as an industry how to have a more healthy environment so that competition drives innovation. So that competition drives down prices, so that competition drives down options. Those are things that we believe we have to see as an overall industry. The part that we play in that? Well, we believe that as the largest provider of products to the consumer, we have to have a little bit of a heavier hand, which is why we’re in the furniture business, which is why we play a big part in the appliance business, which is why we want to work with manufacturers on how to reengineer and re-innovate these products to make them more affordable for consumers for one simple reason.
We know that more consumers will enter this lifestyle, the more affordable we make the product. Rates are going to come back down at some point, for sure. But the product itself has to be more affordable. If you go back and look at what it was 36 months ago, we may not get back to that even out of a normal inflationary environment, but we got to come off where we were. And the suppliers are a big contributor to that.
Brandon Rolle: Great. Thank you.
Operator: The next question we have is from Craig Kennison of Baird. Please go ahead.
Craig Kennison: Hey, good morning – for taking my question. Matt, you mentioned your affordability curve. I know you have good insight into consumer behavior. And I’m curious where the sweet spot is today in terms of a monthly payment and how that compares to last year or 2019?
