Rupesh Parikh: Great. Thank you for all the color. I’ll pass it along.
Operator: The next question comes from Bill Chappell with Truist Securities. Please go ahead.
Bill Chappell: Thanks. Good afternoon and also congratulations on the quarter.
Cord Christensen: Thanks, Bill.
Bill Chappell: First, just trying to understand the plans to both reinvest in A&P in the fourth quarter and reinvest kind of the cost savings from the rationalization into next year. With the fourth quarter, I’m just trying to understand, I mean, with flea and tick season largely over, where does that money go and why do it now? Why not kind of push it towards next year? Or is there some major program or a big promotion going on in fourth quarter that could benefit sales? Or am I missing something?
Cord Christensen: Typically, Bill, we invest heavily in A&P, which drives sales and drives conversion. We started in Q3 to start investing in the top of the funnel to drive awareness and build brand awareness. We’re going to push a little more of that into Q4 to be ready for next year because as you know, once we get into Q1, we’re starting to see the benefits of that. We’re starting to see it working and obviously the numbers from this year obviously shows that we’re definitely investing properly, we’re tracking it properly, but we have an opportunity to really start to drive top of funnel, which will lead to we think our ability to match that with A&P that goes into conversion next year. And we think will drive our ability to continue to build our brands in a very, very positive way.
So that’s something that we’re again, fortunate that we’re starting to get the momentum to where we can do it. And we want to continue to really support the brands and drive that top of funnel brand awareness and then drive the conversions we get into season.
Bill Chappell: Got it.
Michael Smith: And Bill…
Cord Christensen: And then, on – go ahead.
Michael Smith: Just to build on that Bill, I think it’s important to note that flea and tick is our largest category, but it’s close to 40% of our revenue, not all of our revenue. And when you look at Q4, it’s closer to 30%. So there are categories we compete in that aren’t with that seasonal profile. And if you look at the dog treat category, it’s actually the inverse where Q4 is actually the largest quarter of the year for that category, and it’s an area where we have the most white space and brand building opportunities with our Minties portfolio that we will be leaning into as well.
Bill Chappell: Got it. I’ll make sure to get some Minties for my dog’s stocking stuffers. So I understand. On the services side, on the rationalization, I guess two questions. One, would you expect these locations, I mean, I assume some of them are in Tractor Supply stores or in small pet stores to go back to mobile clinic locations, and so you can actually recoup some of that revenue down the road and then also the implication that the 133 left are available or are suitable for the hygiene model. Would you expect that to start in earnest in 2024?
Cord Christensen: Yes, but I think in general, first, we’re extremely positive about how things are going. Things are going well, we’re not ready to declare victory and start converting tons of locations, but those 133 stores that are left definitely have the ability to add more services and do that. If you look at the stores we’re closing, there’s a small percentage that we think can actually recoup the pets into the community clinic business, and so we’ll definitely lose some of it permanently. But if we can’t convert them to the hygiene model, if we can’t get a veterinarian, if the financials coming out of COVID aren’t great, we just had to do what we had to do to get the money that we’re investing and put it back into things that we know we get a better return. It’s that simple.
