Gas is volatile, no pun intended, and it’s been quite profitable in some quarters more than others. But we think that we’ve got the different levers and puts and takes, if you will, to do that. But ultimately, it’s about driving sales. And certainly, we know we’re getting the customer in. We’re getting more of them in and they’re, again, renewing at the highest rate ever. So we’ll go through this as good, if not better, than others.
Operator: Your next question comes from the line of Michael Lasser with UBS.
Michael Lasser: So Richard, last time there was an economic downturn in the United States and globally, Costco performed pretty well, was able to comp positive during that time. This turnaround, it’s a much bigger business, and it might exhibit more economic sensitivity. So a, is that how you’re thinking about it? And b, what actions would Costco take to preserve its profitability in the event that it saw negative comps in the coming quarters?
Richard Galanti: Well, we’re going to do things that drive market share, first and foremost. We are certainly cognizant of the bottom line. And I think this quarter is a good example of that. But at the same token, we’re going to do what we need to do to drive sales because long term, when we get our customer in and they buy stuff, they’re going to come back and buy more stuff. And we’ve always done a good job of that. Again, this one is a little different, this economic downturn, with the rising interest rates and the headlines of recession and high interest rates. But that being said, I think we’re fortunate in the sense that we’ve got a multitude, various types of businesses within our business from big ticket discretionary items to food and sundries and health and beauty aids and fresh foods, which is really driving the cart right now more so than it has in the past.
So we’ll continue to do what we do. I remember years ago, someone asked about if sales were slowing down, what would we do. And we said we’d drive more sales by being even hotter on prices. But generally, that’s worked for us, and I see that equation continuing.
Michael Lasser: And a follow-up question is, to your point, the inflationary number that you cited are lower than what others are experiencing. So presumably, your price gaps are widening, which makes sense and you’re delivering more value for your member at a time where they arguably need it. And with that being said, how does the fact that you are delivering more value to your consumer and then maybe somewhat pressured play into your mindset around whether or not you would raise your fess? I believe this spring would be the 5-year anniversary of the last time you raised your fees and you typically do it around this time.
Richard Galanti: Yes. Actually, June would be our sixth anniversary. As I mentioned in the previous calls, looking at the last, I think, 3, they averaged around 5 years and 7 months, which is about now or last month. And what we said over the last few quarters is that, in our view, it’s a question of when, not if. And so we’ll let you know. But keep in mind, that’s one way that we become even more competitive. We take those monies and directly become even more competitive. I might add though, our locations do weekly comp shops of 100 to 150 key items, all directly competitive items, and then a variety of other against our direct competitors and other limited comp shops against other forms of traditional retail where the gap of competitiveness is much greater.
But at the end of the day, our relative level of competitiveness, in our view, is as strong as it’s ever been. And we do that weekly in locations. And every 4-week, monthly 2-day budget meeting, each of the regional operations’ senior executives get up and show those numbers. And you can rest assure we’re going to continue to do that.
Operator: Your next question comes from the line of Christopher Horvers with JPMorgan.
