Melinda Whittington: Yeah. Good morning, Anthony. I’d start by saying, if you look at year-on-year comparisons for like our furniture galleries, we actually saw some improvement in pace Q2 versus what we were seeing in Q1. So that — and that’s over three months, that’s a little more of a trend. As far as over this last holiday, last Friday is Cyber Monday, we’re actually generally pleased with our performance in both our furniture galleries and for Joybird, right, which are real consumer businesses where we have to some (ph) on the pulse and what the consumers doing. We saw continued strengthening thus far in November of sort of that pace year-on-year, too early to call a trend, right? But in general, we’ve seen a trajectory of improvement.
Anthony Lebiedzinski: Got it. Okay. That’s good to hear. And then in terms of dealers delaying the receipt of finished goods because of warehouse constraints, are those mostly firm orders or is there maybe potential risk that some of those orders could be canceled? How should we view that?
Melinda Whittington: Mostly firm orders, and to be clear, some of that sits in, if you think about some of our case goods and all, where we’re importing finished product that’s a driver where we’re manufacturing in some cases that’s just slowing the pace of the manufacturing to get those things out the door as well as we’re communicating with our customers on the timing they’ll take.
Anthony Lebiedzinski: Got it. Okay. And then in terms of the demand levers, is increased advertising the main tool that you’re using or do you think perhaps you’ll need to be more promotional given the current demand environment?
Bob Lucian: We’ll likely end up in doing both. The marketing piece is important for the retail stores to drive traffic. And once we get them in the store, we’re able to do a great job converting them and upselling them with design sales. On the promotion side, we haven’t seen a very large — we’re looking, we’re watching, we’re waiting for somebody to go out there and start doing some crazy things get product moving off their floors or out of their warehouses. We haven’t seen that yet. We’ll be keeping our eye on that. We continue to say that we don’t want to leave down crazy amounts of discounts, but we also want to make sure we maintain share. So we will ensure that we remain competitive as we move through the holiday period into — in the President Day and we see what happens with the economy, with the consumer and with what our competition is going.
Anthony Lebiedzinski: Got it. And then lastly, how should we think about segment profitability near term and long term, if you could just give us different puts and takes as to how we should think about that?
Bob Lucian: We made a number of comments. We continue to make a number of comments. Our goal as part of Century Vision is to reinvigorate that La-Z-Boy brand. The biggest part of that is really just proportionately growing our La-Z-Boy retail network. And that’s new stores, that’s some new formats as well as remodeling our stores and getting more other formats that we have. That coupled with the Joybird growth, we expect the business prior to — if you go back two or three years, we were more of a kind of a 40 — low 40% direct-to-consumer, high 50% — high-50%’s wholesale and we expect that to kind of flip flop over the next call it three to four years. It’s where we’re close to 60% direct-to-consumer and over 40% for wholesale.
And that’s not going to be the wholesale business shrinking, it’s going to be more just growing that direct-to-consumer business at an accelerated rate. And that’s as part of Century Vision, that will be higher profits because we have higher gross margins, we get higher fixed cost leverage. So that will be a key part of how we drive our operating margin into that double-digit range on a more consistent basis over time.
Anthony Lebiedzinski: Got it. Thank you very much and best of luck.
Melinda Whittington: Thanks, Anthony.
Operator: Your next question for today is coming from Brad Thomas at KeyBanc.
Brad Thomas: Hi. Good morning. Thanks for taking my question. I was hoping to talk a little bit more about Joybird and I was wondering, if you could talk a little bit more about how much some of the marketing dynamics are affecting sales, your underlying enthusiasm for the business? And if you could talk a little bit more about maybe putting aside any kind of one-time issues? what you think sort of underlying unit economics are looking like in your enthusiasm for the business as we look out a little bit longer term? Thanks.
