John Peyton: Yes, Jake, it’s John again. I’ll take it at the top and then ask again, if Tony and Jay have anything to add. When it – what’s the value? I think an important thing to keep in mind is that both of our brands work very closely with it, with our franchisees to determine what these value promotions look like or what an LTO looks like. And that includes not only the marketing behind it, but the margins behind it as well as the data we know that when we invite a guest in for our LTO they typically spend more in addition to what they are there for the LTO, it’s obviously it’s also driving incremental check. One of our stacks from the last quarter is while we did see a modest slowdown in traffic, at both brands, average check for the quarter at both brands remain steady compared to the prior two quarters.
So when our guests are with us, they continue to enjoy the full offerings of both brands Applebee’s and IHOP when they’re in the restaurants. So that’s a great data point for us that demonstrates that it’s not discounting but we’re using the value offers to bring in guests in a way that resonates with them. So they maintain that average check. And Tony, only if you’ve got something to add chime in and then Jay.
Tony Moralejo: Yes. Happy to. Thanks for the question, Jake. Value remains incredibly important right now, but honestly, it’s – it remains the same across all economic cycles. Applebee’s is built for the average American, eating good in the neighborhood is more than just a tagline. It means we’re providing good food at an affordable price in an environment where everybody can come and be themselves. That’s value – that’s the value that the American consumer is seeking and expects from Applebee’s. An example that you mentioned in Q2, we delivered value through affordability through campaigns such as our two for 25, which we ran in June with strong results. It’s compelling and it provides the values again, that the guests are seeking in this environment, which is why we have outpaced our direct competitors from a value attribute perspective for many years.
Jay Johns: Hey, Jake. This is Jay. The only thing I would add is just on top of what I said with my last answer, I’ll give you an example. We rolled out brand new crepes, both savory pan [ph], typical breakfast style type crepes. And when we rolled those out, we did those with a buy one get one promotion. And while that may seem like a deep discounting, the purpose of that really was to get trial by two people at a time when they came in to try our new menu and try the new crepes. And it worked to perfection. It not only provided great value for guests coming in, but when the buy one get one promotion went off, crepes sales actually went up, compared level was when they were coming in and people were getting one for free also.
So it did exactly what we expected. We launched the product, we were able to give a nice value. So there’s a prime example of how you can almost marry your new innovation with the value as part of your program to build your overall core business.
Jake Bartlett: Right. I appreciate all of that. And my next and last question is about G&A. And I maybe if you can confirm kind of what the recurrent a – as you calculate, I just want to make sure I’m kind of backing out the right numbers in terms of the one time. But it does look like in G&A, the implied back half G&A is a step up from what you spent in the second quarter. So the question is what is driving, if that’s right, but what is driving the increase in, I think significant increase in G&A spend per quarter versus the second quarter. And then also you’ve talked in the past about having your G&A spend being incomputable [ph]. So in a – if the macro kind of slows down, you can pivot and maybe delay some project or what have you and be flexible with your G&A.
So the question is, when do you choose to do that? You maintained your – the G&A guidance this quarter. But at what point and maybe if you can confirm that you do have that flexibility? Do you kind of pull that lever to sustain EBITDA growth?
John Peyton: Sure. Vance, why don’t you?
Vance Chang: Hey Jake. Sure. Jake, good to see you. As I said, if we take out the one-time items which is primarily related to Flip’d costs, G&A is about $44 million. And so that’s down from Q1 of 2023 and flattish to Q2 of 2022. We have some normal sort of seasonality within our core G&A. So if you go back to a few years, you’ll see that Q4 is normally traditionally a little higher than the rest of the year. So which is the reason why we’re maintaining our full year G&A guidance. Now, the places that we’re investing in, right? And it’s franchisee – it’s people or systems related to building up franchisee support, building up our development capabilities and improving the guest experiences. And these are projects that that take time, but they’re building blocks to any successful franchisor, right?
