Eric Wold: Thank you. That’s helpful. And then, without any new stores next year, I guess excluding — if you start building towards the end of year for a store to open ’25, excluding that just what is kind of the CapEx plans for next year? Are you still doing any remodels, upgrades, what kind of maintenance?
Jeff White: Yeah, we’ll have to do normal maintenance. And if you look into the script, I gave a range of what we spent on new stores this year. We’ve invested more than $45 million in new stores and refreshes this year. And then, if you bump that up against the CapEx guidance that I’ve given, that’ll give you kind of an understanding of what normal maintenance CapEx looks like in a year. We’re going to have to maintain the fleet next year. But in terms of big amounts invested in refreshes and new stores, I don’t think you’ll see that coming through the pipeline.
Paul Stone: I do think there’ll be a piece from a technology standpoint as we look at us being able to invest and continue our investment as far as merchandising, planograms, how we operate the stores, and then just for ease for the customer that these are things that we’ll have to invest in. I would just add that to the everyday, day in and day out, CapEx that you would typically have.
Eric Wold: Okay. Final question if I may. I know you mentioned, Jeff, that the aggressive discounting you’ll be doing in the fourth quarter is playing into that 600 basis point to 800 basis point reduction in margins year-over-year. How much of that is kind of one-time from these actions versus maybe structural that needs to continue in the next year?
Jeff White: Eric, that’s a good question. I want to emphasize all of that degradation and margin is relating to this one-time event of us clearing through this inventory We are hitting it very aggressive in the fourth quarter to ensure that we’re clean of it by year-end and we start 2024 in a much better position so we can position Sportsman’s Warehouse for success.
Eric Wold: Perfect. Thank you, guys. Appreciate it.
Operator: Thank you. Our next question is from Mark Smith with Lake Street Capital Markets. Please proceed with your question.
Mark Smith: Hi guys. Just want to follow up a little more in depth on that last question. As we think about the 600 basis point to 800 basis point decline here in Q4 versus 300-plus basis point in Q3, is it really — is it purely just clearing out and finding — getting rid of this excess inventory and apparel and footwear, or how do you compare kind of the holiday Black Friday promotional environment this year versus last year?
Jeff White: Hi, Mark. This is Jeff. That’s a good question. If we look at just the overall holiday environment. I think most retailers are coming out and Sportsman’s included with the issue of driving traffic. So, in order — in effort for us to drive traffic, we’re really focusing on heavily discounting the apparel and footwear, making it known. If you’re subscribed to our advertising campaigns, you’ll see that we’re going to hit it heavily over the next three weeks before Christmas. So, we’re using that as a traffic driver to get people into stores and shopping the other products. So, I’ll frame up again that the 600 basis points to 800 basis points is driven primarily by the reduction in margin in the apparel and footwear that we’re moving through the end of the year.
Mark Smith: Okay. And if you could maybe tell us what percent or how you feel about as of today that you’ve moved through of that inventory and maybe how much it has moved since the end of Q3?
Jeff White: I will say…
Mark Smith: Maybe a different way to look at that is, do you feel like you’ll be done by the end of the year?
Jeff White: We’ve moved through a very good portion of the inventory in Q3. What we have left to move through in Q4 is items that we have to take deeper discounts on, which makes the margin impact more significant than it did in Q3. I was very happy with the team’s execution in Q3 on moving through the clearance apparel and footwear. I’m very pleased with the progress, but the items that we have left over are going to need much deeper discounting in order to move through the remainder of it by the end of the year.
Mark Smith: Okay. And then I think you guys may be called out a little bit within the ammunition category, some margin pressure. Can you walk us through maybe anything that’s going on, just as we look specifically at that? Is that just inventory being back fully stocked and need to move some of that? Or any additional insights into the ammo space would be great.
