Another sign that I think things are going to start to calm down, January and our Vistar and our Core-Mark business are typically a time where people increased prices, and they certainly did a year ago January. And what we saw this January was a lot of people did not take their normal price increase, and we saw a step down in inflation from December to January, more about prices going up last year and not going up this year than anything coming down. So, I don’t know. I mean, I just don’t see people reducing their menu prices. I think that it’ll be more like kind of hanging on where they’re at now and, promoting heavier.
Edward Kelly: And just quickly for you, George, you mentioned an improvement, off of the soft January on weather. Any additional color there?
George Holm: It was a normal week for us as far as percentage increase over the previous year, and January certainly was not. And there’s another factor with it too. The calendar really helped us at the end of Q2, particularly the last week, and it hurt us the first week of Q3. So, that’s another factor with it. Now, it’s a very low volume week anyway. So, when you spread that over 13 weeks and certainly over 52 weeks, it’s not real material. But I don’t see any change in the industry. I really don’t. It’s hard when you look at numbers like that. But when you look underneath things, it looks fine to me. I think the demand is still out there.
Edward Kelly: Great. Thank you.
Operator: And we do have our next question from Kelly Bania with BMO Capital Markets.
Kelly Bania: Good morning. Just wanted to follow-up, a little bit on Convenience. George, I think you’ve talked about 6% growth, there, if you include the cases that go through Foodservice, I’m assuming that’s mostly just food, Foodservice, type product, maybe correct me if I’m wrong.
George Holm: It is entire.
Kelly Bania: Entire food. Okay. But can you just talk a little bit about the appetite for Chain and independent, convenient stores to kind of make that conversion, and you talked about the turnkey programs. But, just in this cycle where maybe there is maybe a little bit of softness, what is that appetite to make that, transition? And then can you also elaborate on the new business wins you sort of touched on?
George Holm: Yes. I think the appetite is high. I mean, certainly, the tobacco side of their business, is going to continue to slide, and they have to have something to replace those gross profit dollars that that creates. And I think Foodservice is the best way for them to do that. And, I’m really enjoying watching how many of these programs were getting into places that didn’t do foodservice before where they’re finding space in that store that isn’t giving them the return that it used to give them and, putting Foodservice product in to take its place. Now typically, there’s equipment involved there. There’s signage involved there. So, it does take a good bit of time. As far as, the new business goes, we have several things that we’ll have starting in the next six months, often it’s a situation where, you have to wait for that contract to end.
In some instances, the current supplier has been notified, and some they haven’t. So, that’s not our job to do that. So, we don’t talk specifically about any piece of business, but we have great confidence in our future growth within our Convenience area.
Kelly Bania: Okay. That’s helpful. Maybe I’ll just tack on another one on Vistar here. I think you said the inflation was just under 7%. So, it looks like maybe cases were just slightly positive. Can you just elaborate on the channels that maybe are growing or not, and just maybe as you think about case growth for Vistar into the back half.
Patrick Hatcher: Yes. Kelly, this is Patrick. I’ll take that one. So on Vistar, the channels where we saw some really nice growth in Q2 were in vending, office coffee, office supply. Yes, theater, was a relatively soft quarter for them, just not a lot of content out there. But as we go forward and looking at the back half of the year, again, they had a really strong quarter given the fact that they were topping some inventory gains in Q2. We don’t expect that going forward, but the channels that we see growing, they always have a relatively off January as well, and then things started accelerating for them. So, we do expect most of their channels to show some nice positive growth for the balance of the year, including theater, as we get into March and later into the year with some new releases coming out and then vending and office coffee, should well, not so much office coffee, that’s kind of tail end of the season form, but vending should pick up quite a bit too.
George Holm: And then I would also add, Kelly, that our e-commerce business is doing very well.
Kelly Bania: Thank you.
Operator: And our next question comes from Alex Slagle with Jefferies.
Alex Slagle: Hi, good morning. Hi, guys. Thanks. Just wanted to touch on the Chain business, national Chain business and, you talked about some of the optimism that you’d see the case growth start to pick up, and it does seem like you’re seeing some green shoots there merging. And is this mostly a function of your customer mix, or is there signs of broader strength in the full service casual dining category where there maybe flexing, their benefits of, the marketing voice and value out there in this environment.
George Holm: Well, we do have accounts in our national account mix that, have not done well for quite a while. We’ve seen a little bit of the bouncing off the bottom, I would say. We have some that are, on a great growth path, so that mix coming together, in aggregate, they did grow, which was really nice to see. We had a little bit of new business come in. We have more that starts, actually next month, and we have more that starts in May. So, we’ll be putting out pretty good, national, account case growth, and it’s all in the restaurant area.
Alex Slagle: Got it. And as a follow-up, just more broadly, the positive mix shift that you’ve seen across products and customer types, I mean, it’s been a nice tailwind for a while, and there have been internal and external drivers behind that. And we talked about some of this with the independents, but just kind of curious where you have the most confidence in seeing these positive shifts continuing and if there are certain corners of your business that might emerge as bigger or smaller drivers in the future?
George Holm: Yes. Well, I see our independent Foodservice business continuing to grow well. I have great confidence around our Foodservice business into Convenience. E-commerce, definitely a strong point for us. And as far as the mix goes, I mean, that’s really been our story for 20 years. We’ve just always grown better in the areas that produce a higher margin. And, excluding when we’ve made some big acquisitions that maybe have a different mix of business than we have, and I think that’s going to continue to be the story for us. We certainly like the national account business, and we have some great customers and some really good relationships, but that’s not going to be what drives our gross margins, but some of the business is very efficient and very profitable.
Patrick Hatcher: And Alex, I’ll just add because George, brought up on the call, those turnkey programs go into Convenience, Perfectly Southern, they have huge potential for us.
George Holm: They do. And, we’ve got some strong brands that we’ve developed, and it took a while. I mean, it is a different business. We had to do some tweaking to product. The product has to hold up longer than, what you would typically sell to a restaurant. It’s not what I would call absolute immediate consumption. We had a lot of work to do, and we’re pretty much through that. And, we just look at this as a good growth engine for us.
Alex Slagle: That’s great. Thank you.
Operator: And our next question comes from Brian Harbour with Morgan Stanley.
Brian Harbour: Thank you. Good morning. Just maybe a quick one first. Is the weather impact in January more significant in any one of your three segments? Like, I don’t know if c-stores deals that more or anything?
George Holm: It was the most significant probably in Foodservice, but Convenience was very close to that. Vistar, not so much.
