Those are the ones that are going to be very peaky at dinner or peaky at lunch where we have that longest line, because we often talk about PDK with the back line digital components and helping us with all that digital businesses coming through those channels. PDK also includes a handheld order tablet that helps us move the frontline. So, that’s why we’ve prioritized those shops. And when we put it in there, we get the benefit of being able to move that frontline and extract even more throughput. And, of course, there’s a benefit that goes with that. The last thing I’d say, we have to give our operations team a lot of credit here. They’re becoming more seasoned. The multi unit operators at the district manager and director level have been in position for a long time.
They really are gelling as a team and their management of the labor and the stability of that management continues to help us as well.
Jeremy Hamblin: So as a follow-up question, as we look towards getting to that 15% shop level margin target for FY 2024. Why don’t I just understand in terms of the component parts here, your guidance for FY 2023 is 13.4% to 13.9% shop level margin? In terms of which of the line items you expect to generate that kind of 200 to a little bit over 200 basis point improvement in margins next year. Where do you expect the primary contributing factors to come from? Is that still labor and occupancy leverage or what are kind of the factors you expect to drive most of those gains?
Steve Cirulis: I think it’s you hit on two of them, I can give some more color. I think certainly on the labor side, we expect to get more efficient and effective through PDK as well as some additional efforts to continue to optimize labor in the shops as Bob described. That will be a major contributor to it. We frankly, on the sales leverage, they’ll flow through the occupancy. That’s going to be another kind of a benefit to us. But also, we expect to see continued benefit to us in terms of food input costs that will be a contributor as well. And then when you look at the business and you say, okay, well, there’s not one silver bullet for us that’s going to push the margin all the way. It’s going to be a contribution from a few other things too.
So, for example, we expect our catering business to continue to grow that tends to be a healthy margin business for us. We still have runway yet to go in our CBD portfolio. And that still continues to be a tailwind for us as there are return to work, there’s return to work momentum that continues to build. That’s going to be a component for us as well. And then, we also will continue to price strategically to continue to outrun inflation. And we feel like, while we won’t expand margin because of that, we will remain competitive and being competitive means for us kind of being at or below where our fast casual competitors are, and we’ve seen some benefit on traffic from being in that position. And so added traffic, obviously, creates the leverage that then starts to flow through the rest of the P&L.
Where we typically don’t get, a ton of additional leverage like we used to before the pandemic is in our other OpEx line, about half of it’s fixed and the other half is floats with the business. That’s where our brand fund sits. That’s where our fees for third-party delivery and so forth sit. So, we might get a little bit of benefit there if we see continued shift away from the DSP component of things. But it’s really that amalgamation of all those components that I described that’ll help us get to that sixteen. And by the way, based on our momentum and our trends, we feel like we’ve got that 16% clearly in our sights for next year.
