Nicholas Pinchuk: I could let out. Okay. Aldo agreed. Okay, you can answer the question, Aldo. Go ahead.
Aldo Pagliari: No. I think, David, I think most of the pricing actions a lot of incurred in the rearview mirror. So what you have now, as Nick has mentioned already, when you attenuate the incremental cost of spot buys have not gone completely, but they’re greatly reduced. And steel different grades of steel at different prices, but particularly cold rolled steel, which is used in our tool storage products has come down, and we’re able to hold on to the price that was set before and therefore, the benefit of material cost reductions accrue to the margin. So that’s what you’re seeing. And yes, I think that with a brand like Snap-on and the power of our approach to the market and the demand that Nick described that’s out there, I expect that we’ll be able to retain these types of margin performance as we move forward. Nothing’s guaranteed, of course.
Nicholas Pinchuk: I was watching a show last night and somebody said on the show, it was movie and said, electronic prices only go down, Snap-on prices only go up. We don’t drop our — I mean it’s because you’ve got all the promotions and everything. It’s hard to put your finger on it. But generally, I don’t see us surrendering that too easily.
David MacGregor: Can I just ask how much of that margin benefit that incremental margin was a result of the capacity constraints forcing the mix towards more customized tools because that sounds like that’s fair — new capacity.
Nicholas Pinchuk: I don’t know. It could be — there could be some of that in there. Certainly, that — the big factor, though, is there could be some of that. You’re probably right. There’s some of that. But the big factor, I think is the improvements in the face of the idea of no more spot buys, no more of those huge spot buys. So you’re seeing that. Actually, we’ve been making improvements better than we have been showing for some time because of the material cost. And so what you see that is abating. So you’re seeing a lot of that. So basically, I don’t know where I put it on the foot of more customized product. We did sell a lot of customized products. So that works but we don’t necessarily want to back off it. And so when you do have capacity constraints, you do tend to go to that.
But on the other hand, when you got capacity constraint, you spend a little more money. You’re looking at the SG&A and stuff like that, SG&A is up a little bit. And it takes you a little bit to manage through that. So you got some goes ins and goes out there. But there’s a factor. But the big pack is RCI.
David MacGregor: So let me just ask you about the organic growth of Snap-on tools because you report 1% organic growth. When you were talking about the Snap-on tool gross margin, you say both volume increases and price gains as drivers. So how do we reconcile the volume increases and price gains that you referenced in the gross margin story with the 1% organic growth and essentially flat in the U.S. Do we just take away from that, that the gross margins were essentially all cost reduction as opposed to revenue growth?
Nicholas Pinchuk: Well, look, I mean, some of this can be plant to plant and production line to production line, but I think you can say in aggregate, that’s probably true. That’s probably true. You don’t get much wind in your sales from that kind of increase. It’s not zero though, not zero increase. And so you get some of that. You have some international businesses that came back in this situation. So we had some things happen in that situation. but that’s got to be the case right? You didn’t get that much volume.
