Jed Gold: Yes, Simeon. So, we are still seeing some softness on the resale side of the business. As you know, we had a really strong September and October as we highlighted on our last call. Those trends moderated just a little bit and didn’t transcend into November, December and going into Q1. So our full year guidance calls for comps in the 0% to 3% range. Keep in mind, particularly Q1, we have some really, really strong lap, and so given that difficult year-over-year comparison, we think that the first half could be 0% plus or minus, and the high end €“ and then at the high end of the range plus or minus in the second half of the year due to the laps that we talked about and also just the natural ramping of some of our greenfields as they start to get picked up in that comp store.
John Lai: Yes. And Jed, I would add to Simeon’s question. I think when we look at our retail business, which we’re right now laser-focused on. We have seen what we’re considering a reduction in frequency. It’s not necessarily a lost customer. It’s a customer that’s coming in less often. We believe it’s primarily macro driven, less so weather, less so competition. We also believe €“ we don’t have any hard data to support this. This is coming from probably the bottom quartile of our cohort customer base. I think the good news when we look at just other metrics that we keep an eye on our ticket average year-over-year is up over $1, north of 9%, which is good. We haven’t seen any material trade down in any package €“ percentage of package sales.
So our premium package mix is holding up nicely. And as you know, the margins on those premium packages are beautiful. So the business is on solid footing and on healthy grounds. And what we need to do now is just get better at marketing and see what we can do to drive retail traffic.
Simeon Gutman: Fair enough. And then competitive backdrop as well as the deal flow or the deals that you’re looking at, has anything come in yet as far as more attractive because there is more willing sellers? Or is everyone frozen given the rate environment and you’re just keeping your head down waiting for the right chance?
John Lai: Yes. So when we look at unit growth, we have, as we’ve shared in previous calls, we’re really doubling and tripling down on our greenfield development given the attractive economics and kind of how well we’re performing. As you’re aware, M&A has been a big part of our story and has helped us get to where we are. But given how €“ what we believe to be overpriced assets and us being very disciplined in our approach to M&A., we’ve been happy sitting on the sidelines and making sure that we’re not overpaying for businesses at the very core. So what we’re seeing right now is a slowdown across €“ and we’re not alone right now. So what we’re seeing is a slowdown in M&A activity across the industry, kind of coming back down to earth from a multiple standpoint.
We think that, that’s all healthy because things have gotten a little too exuberant, if I can use that word. And again, I think that, that’s a natural reset of where things ought to be. So we’re very conservative when it comes to our M&A approach going forward. We’re not going to swing at every pitch. We’re going to make sure that we look for the right strategic opportunities in existing markets and probably do just onesie-twosies. That said, if there is a platform that comes along that looks attractive, and it helps move us into a new geography. We’ve been known to surprising people. So more to come.
Simeon Gutman: Okay, thanks, John. Thanks, Jed. Good luck.
John Lai: Thanks.
Jed Gold: Thanks.
Operator: Our next question will come from Michael Lasser with UBS. Please go ahead.
