David Kim : I think it’s both, but I really attribute that to the staff, the people that work for GEN. The more you — there’s a saying, the squeaky wheel gets oiled and gets more attention. We have great professional guys, they know what they’re doing, so that process is getting easier and shorter.
Todd Brooks : And then the final one on the real estate side, I know that, you’ve laid out the eight units for this year and the 10 leases that are under — or the 10 sites that are in process for getting locked up for ‘25. Thoughts about buffers, are you still feeling the need to build buffers of potential locations given how much more professional that development team’s getting for you? And if you’re looking towards ‘25, is the governor to 10 units more, how fast you can grow the restaurant level talent, especially when you’re going to newer markets?
David Kim : Perhaps if you can help me define when you mean buffer? I don’t quite understand. Can you?
Todd Brooks : So ask where you were targeting, let’s say you’re targeting the eight units for this year and when permitting landlord lead time supply chains were really tough. You almost had to have 11, 12 units in the works for a year to be able to deliver the eight, but it sounds like the environment and the team are much tighter. So do you feel like you need to still run kind of a couple of units in process at any given time? If one washes out in a given year, you run into a permanent snafu or just how much less friction are you seeing in the overall construction environment where you may not need that anymore?
David Kim : We have a much bigger buffer because of our ability that we think we have because of the upfront investment we’re making on personnel. We are okay having a lot more buffer. Even if we were efficient in getting that 10 built and we had more where we are able to take that on as of today. So we might, for example, this is just an example. Let’s say we said that we can open 10 in 2025. Maybe we can end up at 15 because the buffers became a reality, right? So we’re comfortable having more buffer because the more efficient we get those buffers actually can now will turn into new store openings.
Todd Brooks : And then one more question. I know distributor switches are never easy on a team and the supply chain pros as you try to accomplish those, as we’re thinking about that approaching 18% restaurant level EBITDA margin, how should we be thinking about food costs with a full year under Cisco and ramping into that system and also layering in, if you do have success from a sales mix standpoint with the premium pricing premium product here, how should we be thinking about food costs with both of those realities potentially playing out over the course of this year?
David Kim : The switching of a major distributor has to do with the systems that they have and we get adjusted and they have to adjust. We are constantly meeting with Cisco, at least the senior level personnel to improve on that, and it is improving. I actually sit on those meetings to make sure that the late deliveries or the missing product percentage drops. In terms of products, we don’t — it’s streamlined very well. We don’t have that issue and the food cost is actually stabilizing a lot. Again, I believe on the last quarter call I said we are really not concerned about the increase of food cost. It’s very much stabilizing. We are at pre-COVID level of stabilization.
Todd Brooks : And then the premium tier products and the premium pricing, is that beneficial to food cost or is the $20 upcharge basically allowing you to hold food cost in kind of that 32% range?
David Kim : It’s soon to tell but the initial numbers that are coming in as it’s holding.
Operator: Thank you. And we have reached the end of the question-and-answer session. I’ll now turn the call back over to management for closing remarks.
David Kim: We’d like to thank everybody for being on the call. We’re excited that completing our first year and our first filing of our 10-K. Excited for 2024 and look forward to speaking with everybody soon. Thank you very much.
Operator: And this concludes today’s conference, and you may disconnect your lines at this time. Thank you for your participation.
