We’re in a mode right now of saying fix the operations, make it profitable again, and then you can scale as fast as you want. That’s our path right now. So, it’s a little bit of a deliberate strategy there. When we use inspections to increase our fail rate, we’re going to have fewer transactions going through, and that’s okay because we’re not going to let those arbitrated transactions go through. When we get tougher on dealers around the arbitration process and say that you can’t take advantage of it in that process, they’re going to do less transactions on the platform. On the consumer end and C2D, our Instant Max Cash Offer business, consumers aren’t selling their vehicles as much as they were previously. Every player in the market is finding that.
And so when they’re not transacting as much, we’re certainly going to stop them if they’ve got a vehicle that’s not going to be healthy for a dealer to transact with, and we’re going to lower those transactions as well. So, I think it’s a combination of both the macro market and us explicitly and deliberately slowing down transactions, getting them to be profitable and a higher percentage of profitable transactions to then scale up again as we get through a couple of quarters of rebuild here.
Operator: Our next question comes from the line of Chris Pierce with Needham & Company.
Chris Pierce: I was just curious, you talked about 4Q dealer trends in the U.S. How responsive is that to changes in trend? Because 4, 6 months ago, dealers were sitting on overpriced inventory, but January and February retail sales came in, I think, better than expectations. So, I was just curious. And then you’ve got Digital Deal. And I’m just kind of curious how responsive that is to changes in trend in the overall market and the new products you’re introducing?
Jason Trevisan: Thanks, Chris. I don’t think Sam or I caught the crux of the question, how responsive you said the other trends are to macro factors, like inventory levels, is that what you asked?
Chris Pierce: Not sure inventory levels, but I know that the second half of last year was a difficult time for a lot of dealers, specifically used dealers and you guys lost dealers quarter-over-quarter, but then January and February have been better from a retail sales perspective. So I’m just curious how real time are these decisions for dealers in terms of like dealer growth in ’23, what that might look like if the market continues to be stronger?
Jason Trevisan: Got it. Understood. The answer is it’s mixed. You will see a couple of different and even conflicting reactions from dealers. So, when it’s harder for — well, if you go back a ways, when it’s easier for dealers to sell cars, then some dealers will turn off different marketing partners in order to sort of €œsave money€ and drop more to the bottom line because the cars are selling themselves, so to speak. Then in — but then when cars are harder to sell, you will sometimes see some dealers say cars are harder to sell. I’m not sure if I’m going to sell that many, I better cut on expenses just to be safe. You have other dealers that say, I would argue the more long-term focused dealers who say, well, if cars going to be harder to sell, I better invest in marketing in order to keep my inventory turns at a pretty consistent pace over time.
