Operator: And our next question will come from Scott Mushkin with R5 Capital.
Scott Mushkin: Hey guys. Thanks for taking my questions. And thanks for having us out there two weeks ago. It was a great event. So, I want to talk a little bit about the climate that you guys are facing. A fairly large supermarket company, I think, shocked us by actually uttering the D word, deflation, or someone on the call did and they didn’t knock it down. Remind us how your business would perform if we get to a place where there’s just no price increases.
Jason Monaco: Yes. Hey Scott, great to have you out a couple of weeks ago. Thank you. And I appreciate having you here in our Expo. So, how does our business perform? We see ourselves as resilient in both up and down market environments. We’ve seen in the current environment, this notion of disinflation and even deflation on some commodity goods. And as you know, being around the industry a long time, deflationary cycles aren’t particularly unusual in fresh products and in the perimeter areas of the store. And in fact, they move quite quickly. So, we’re quite accustomed to managing through those ups and downs, ensuring that we have the right price points and the right value equation for our shoppers and consumers and getting the right value for our customers who buy through our Wholesale segment.
Scott Mushkin: And I think that was Jason answering that. What are you seeing in the climate? We’re seeing more pockets of competition kind of in certain parts of the country. Certainly, promo is coming back from CPG, but also it looks like some retailers are putting their own P&L at risk or investing. What are you guys seeing?
Tony Sarsam: So, I think what you’re seeing — this is Tony. So definitely, we’re seeing there’s more promotional activity. We took more promotional activity in the quarter as well and had more promotions in the second quarter than we did in the first, and that there’s been continued growth as we look for ways to get our consumers excited about our offering as well as offering them some keen opportunities to stretch their dollar a little bit more. So, we see those as really important ways to drive foot traffic and get folks into the store and then get them into all the other items obviously that aren’t promoted. And that worked for us reasonably well last quarter. We saw with the asset promotions, we actually saw it has a little bit better unit pickup versus the previous quarter.
So, we think that’s working. It wasn’t a landslide of more promotions, it was definitely more. And the work we’ve done with our digital marketing and other tools to get people informed and involved in those promotions is also working really well. And I think we’re seeing that similar — but it appears to have similar activity going on with our competition. So, I guess that’s a natural outcome of where we are right now in the overall environment.
Scott Mushkin: And then, I just had one last one. I think you guys both talked about lower incentive comp but also lower wages and benefits in retail. And I was just wondering what’s driving that and how repeatable that is? And obviously, wage rates continue to climb overall across retail?
Jason Monaco: Yes. Scott, the way I’d think about it, this is a variable comp. So last year, that — when you look at the year-over-year, last year, variable comp was running above plan this year, it’s not. And as a result, you’re seeing some positive comps in those figures. Even the labor and wage component that we referred to in retail relates to the variable comp component that we cascade through our organization.
