John Walker: This is JD. And you’re right. To accurately predict the weather next year is going to be a bit of a challenge. But I would I would say this. Last year, we had a lot of headwinds, not just weather. Weather, it was certainly unfavorable. And we had the polar vortex that affected part of the country, we had drought conditions in the West and Southwest and across Texas, some key markets for us, and these were extended patterns that definitely impacted the business. But in addition to that, we had evolving consumer behavior. After two years where the consumers were very involved in our categories, they started going back to pre-pandemic type activities. And you mentioned inflationary environment as well. So, we saw significant price increase in the category.
All of those causal factors had an impact on foot traffic in the stores. And then, as the foot traffic declined, we saw retailers take inventory reduction initiatives. So there’s a lot to get our mind around here. I would say this that, due to the unfavorable weather, when we look back at those causal factors, we think that over 50% of the impact for the year was weather alone. And returning to just a more normal weather pattern for next year, it doesn’t have to be spectacular. It doesn’t have to be perfect. Just more normal weather, we think, is a tailwind for next year. One of the things that gives us a positive outlook for next year is the fact that when we did have favorable weather this past year, those two weekends where it was favorable, we saw outstanding consumption in our category.
So we believe that consumer is still very engaged. We saw a huge household increase in participants in our categories, and they’re staying engaged. We’ve seen some erosion to that, but many of them still in the category. So there’s reason to believe that if weather is normal next year or more normal conditions, then I think that that’s a tailwind for us.
Timothy Cofer: Bill, maybe one more thing to add to JD’s comments, which were spot on, and to Brad’s question. When you look at the difference between sales and POS, there’s a gap there on garden as well. Right, JD? So, we’re talking five plus point gap between POS and organic sales. And so, that speaks to that inventory deload that JD spoke about that, as you know, impacted the entire store, well beyond lawn and garden. But there’s only so much space in the store and lawn and garden got contracted as well as a result. And so, that delta between POS and sales, also I think back to your question, that decline in POS was far less pronounced than the sales line, which if you want to take a glass half full, as you roll into next year, with hopefully some decent weather, some normal weather could provide some room for growth.
Bill Chappell: Trying to understand the inventory management in Garden, I guess I don’t fully understand why, as you came to the second half, there would have been excess inventory, because, obviously, your different products sold at the first of the season like grass seed versus that of weed and bug killer at the end of the season. So it would seem like it’s different. So, I’m just trying to understand why there was more inventory there. You said you’re also holding back a fair amount of inventory and working capital to prepare for the season for supply chain. Like, what does inventory at retail look like for Garden in 2023 as we stand now and will that have a meaningful impact on the first half sales?
