Darin Harris: Yeah. I think for us, what we’ve really focused on is, do we have the right calendar in place, do we know how to reach our customers in the right way. And because right now, with what’s going on in California, it’s really hard to predict what really will happen with sales. So, we are focused on how do we reach our customers, how do we provide them service in the way that we need to. And really, that’s about we’ve seen things like speed improve year-over-year by nine seconds. That helps sales. Our alerts are down since Q3. All of that will help us. Now, to add color, what I would say is, we think we have a good pipeline of products coming in this year. To get better, what we have to do is, be able to reach our breakfast customers better.
That’s a little bit of the category this quarter that we struggled in, both breakfast and value. So we’ll make sure that we have the right offers for those that are looking for checks under $8 and we’ll have the right offers to drive some transactions there, in addition to really focusing on how do we continue to bring back breakfast. And breakfast was our slowest day part, I’ll add some color here, in this last quarter, mostly because we deleted items. We were simplifying the menu, and — but although it was good for margins, it hurt sales, and it helps simplicity in margins, which we wanted to do for our franchisees. But by removing biscuits, a burrito, a sourdough sandwich, and some salads, we definitely — we impacted sales this quarter.
Alton Stump: Great. Thank you, Darin.
Operator: Our next question comes from the line of David Tarantino with Baird. Please go ahead.
David Tarantino: Hi. Good afternoon. My question is coming back to the pricing philosophy that you have. I know, Darin, you mentioned that the price increase you’re assuming for this year is what you need to cover the inflation. But I guess with traffic running negative, I wonder if you could just share your philosophy on your thoughts on protecting the traffic versus covering the inflation. I know it’s a tricky balance, but, why not, for example, take less pricing in order to protect the traffic in maybe the long-term business model? I guess, could you just kind of walk us through your thought process on that?
Darin Harris: Yeah, I think the real answer is, it’s balanced. So we wanted to provide you a guide on what we need to just purely cover the cost of the wage inflation in California. And that’s what we tried to guide to. We will be watching it, as I said, with our pricing discipline, to understand where is the right place to take price at the right time so that we can limit as much as possible any traffic declines.
Brian Scott: Yeah. And on top of that, we are aggressively continuing our efforts to drive other operational improvement. So anywhere we can create more efficiency within the stores, whether it’s labor or food cost, that will also help reduce the need to increase price as well. So — and we’re just really excited about the innovation in our menu and making sure we — our consumers want to come to us. And so I think as we look at our calendar and some of the innovation we have coming out this year, we feel very confident we can continue to drive improved traffic as well.
Darin Harris: Yeah, one of the things Brian mentioned it, that I’m most proud of in this quarter is RLM. We improved it by 400 basis points. Our franchisees have seen three quarters straight of improved margins. So, the initiatives we’ve been rolling out, the 200 basis point initiatives, have been starting to take hold in the stores. And so the next step is to continue with pricing, watch traffic, make sure we have the right calendar, but also help our franchisees make more money by following through with what we call our financial fundamentals plan. And now that Tom is at Del, he follows the same playbook that we follow at Jack in strategy, and he’s putting in place the same initiatives that are particular to Del so that we can balance all aspects of this — of the business, not just top-line and transactions.
David Tarantino: Got it. Thank you.
Operator: Our next question comes from the line of Chris O’Cull with Stifel. Please go ahead.
Chris O’Cull: Thanks. Good afternoon, guys. Darin, you mentioned product innovation is going to play an important role again this year or next year, I guess. And I believe the Company has indicated a new major product may be introduced next year. Is that still the case? And is there any kind of — and if so, is there a prior new product that may be a good analog to think about for this product and maybe help us understand what aspects of it make it a good comparison?
Darin Harris: Yeah. The core of Jack, historically, is innovation, right. We were one of the first breakfast, first drive-through, and so we’ve got a lot of things in test. We’re getting closer to rolling out that product that I think is differentiated in the market, and we’re excited about it coming, but we’re not ready to announce it yet. But we have plenty of new items in our calendar coming for this year. And the first one I’ll say is things like, we just rolled out Boba this week, and I think we’re the first QSR to roll out Boba. And it’s a great product. We’re excited about what it’s done in test, and it just, over the weekend, was the first entry of Boba into our calendar. So, we’ll continue to do that, as well as introduce really good innovation to the marketplace on things that fit Jack specifically.
