So, when you think about it, maybe from the way you’re thinking about it, will that assortment, when you parse it out, how big will it be? It depends on how big we make that book, how big we make that assortment, how many things we put into contemporary or how many things that wind up going into interiors and how many things go into modern, because you’ve got some things that, that the lines are blurred. We could put it in almost any of the three books. So I think about — the way the way I think about this today is RH is going through a massive product transformation. It’s the biggest thing they’ve ever done. How does the whole thing look? And as the whole assortment gets out there, interiors, contemporary, modern, outdoor, as the books get out there as the products get into the galleries, as we get in stock, what does that total assortment look like and how is it performing versus the old assortment?
We think it’s going to be meaningfully accretive.
Max Rakhlenko: Got it. That’s helpful. And then, no that’s great. And then I guess, can you speak to the phasing of the new products to galleries and your confidence of completion by the end of the first half of 2024? And then specifically, will all the galleries be touched? Will some get more newness than others? Or how should we just think about the totality of the in-gallery resets?
Gary Friedman: You mean the resets, of course? The floor sets. Yeah, I think they’re being done in stages, as we’re ramping up inventory. And it depends again, if that, if you’re ramping up, if all of a sudden you have some really high performing collections, you’re just not going to be up, you’re going to have to fill demand and not put the goods in the galleries, right? You’re going to have to wait. And so I’d say we’re going to get, I don’t know, 90% in stock in Q1 or something.
Jack Preston: As far as completion of the four sets, probably a March time frame. It wouldn’t be the end of the quarter, but rather where we are today, it’s probably March.
Gary Friedman: Yeah, and some galleries will get prioritized versus others. And yeah, I think it’s — I think we’ll be in really good shape by the end of Q1 going into Q2. And then I think by mid to end of Q2, that’s why I say that should be our kind of inflection point. I mean, based on all the numbers we’re looking at today, we don’t have data on modern yet, we won’t until we mail that. So that’ll have same kind of challenges, lots of new product. We’re going to, with any new product, when you don’t have data, you’re going to be 100% wrong with your inventory investment. Like I’ve been doing this a long time. I’ve never seen anybody buy a new product exactly right. So you’re going to be a little overbought, underbought, a lot overbought, underbought.
So if you just don’t, you don’t have exact science, you don’t have any trends on any of the newness. So, it takes, takes a few quarters to kind of get the trends, read the trends right, make the adjustments you need to, get the on orders corrected, make less of this, make more of this and let the factories get adjusted, as they’re ramping up on a lot of new products. But that’ll all work itself out. Again, I just think about this as like, the next couple of quarters will be meaningful. If we’re sitting here, the end of Q2 and we didn’t get the inflection point we needed, that would surprise me. That we think we’re going to get, it’s not a little one, it’s going to be meaningful and it’s going to keep building, as all these things happen, in-stocks, gallery sets, modern, outdoor, and then a recycling and remailing of those books with more newness, right, with probably 30% to 40% more newness.
And then you’ll have some adjustments with that 30% to 40%, but that’ll be much smaller compared to what we’re doing today.
Operator: Your Next question comes from the line of Steven Forbes of Guggenheim Securities. Your line is open.
Steven Forbes: Hey, Gary, Jack. It might be a repetitive question on the product transformation, but Gary, I was really just hoping you can, if there’s anything you can give us or speak to, whether it’s sort of what you’re seeing now or even a reference point back in history on sort of prior product transformation cycles, that can help us contextualize what the potential magnitude of the inflection that on the horizon is and whether we can reference sort of peak demand during COVID or does anything that helps us think through really what should we be expecting behind this product transformation?
Gary Friedman: I think it’s all going to depend on what the macro is doing in the housing market. Yeah so the housing market stays where it is. I mean — again, let us guide you next year, like you’ll get a better sense. So we’ll have a little bit more data. But, I just say generally, I’d be surprised if anybody’s outperforming us when we get to Q2 of next year, I’d quite be shocked. Maybe someone will shock me. I don’t think so.
Steven Forbes: We will anxiously await that. And then just a quick follow up. The 70 new collections that were referenced sort of in past calls, where are we today with the number of collections that are out and how many will be launched by spring next year, by fall next year? What sort of the pipeline looks like?
Gary Friedman: Yeah, there’s more than 70 now. We’ll have probably — when modern — with modern hitting and outdoor hitting, it will probably be somewhere between 70 and I’d say up to 90. And with more in the pipeline. And we have a whole other book we’re working on, that we haven’t announced yet. So you’ll hear about that, that we think is going to be meaningful. And it’s not bespoke, it’s not couture, it’s something we haven’t talked about. And that’s going to be a whole new big thing. So, we’re working on that too. Yeah, so just a lot’s coming, Steve. Buckle up.
Operator: Your next question comes from the line of Michael Lasser of UBS. Your line is open.
Michael Lasser: Good evening. Thank you so much for taking my question. Gary, why do you think you are losing market share? And if it’s an issue with pricing, how much more do you think you need to lower prices in order to stabilize or gain market share?
