Don Allan: Yes. I would say the range actually is indicative of the range of EPS. So if the low end of range of EPS played out that Corbin articulated, then we’d probably be looking at $750 million of inventory reduction. Even though we would be continuing curtailments, the demand levels would be much lower. And so you have two or three points lower demand versus the base case. On the high end of the case, I think the $1 billion becomes very achievable because you’re dealing with much higher levels of demand where organic for Tools & Outdoor would probably be flat year-over-year. And therefore, the $1 billion feels more achievable in that environment, and you’re getting your production levels back to normal levels in the back half of the year or maybe sooner.
And so that’s where the range kind of plays out. As I mentioned earlier in response to Nigel’s question, I do think if demand is stronger in the back half, we could see a possible improvement above the $1 billion. I don’t think it would be a dramatic number, but a few hundred million dollars above that, it certainly makes sense. And so that’s really where that range comes from. It really correlates well with the EPS range, which correlates well to the demand associated with those three different scenarios.
Operator: Thank you. Our next question comes from the line of Nicole DeBlase with Deutsche Bank. Your line is now open.
Nicole DeBlase: Yeah. Thanks. Good morning guys.
Don Allan: Good morning.
Nicole DeBlase: Just to maybe piggyback on one of the earlier questions. Can you just give a little bit more color on the ramp of the cost savings that you guys expect to achieve throughout 2023, would take into the base case? And then any help at all on as we think about 2024 and 2025? It might be a bit early to give us explicit numbers. But is more of the plan coming through in 2024, or is it more back-end loaded towards the end of the three-year period? Thank you.
Corbin Walburger: Hey, Nicole, it’s Corbin. I’ll take it. So as Don mentioned, in 2022 in the second half, we’ve got about $200 million of savings. And as we look into 2023, from an SG&A standpoint, we expect to get about $300 million. About 70% of that will come in the front half and about 30% will come in the back half as you lap 2022. And then on the COGS side, we expect about $450 million, and that will build throughout the year. So Q1 will be a little bit higher and then it will build in 2Q, 3Q, and 4Q will be pretty even.
Don Allan: Yeah. And I think for 2024 and 2025, I mean, we’re trying — obviously, with the numbers that you just heard, we believe we’ll have $1 billion of value creation by the end of 2023. And then there’s another $1 billion related to the supply chain transformation in the subsequent two years of 2024 and 2025. Right now, based on the plan we have that our operations and business teams have collectively worked together on, that $1 billion has a specific level of detail and actions that are associated with it that we believe are close to being rock solid. And, therefore, we do think in those two years, we’ll probably get about $500 million or so of that in each year. And we’ll see as we get deeper into 2023, whether more comes in 2024 versus 2025, time will tell.
But at this stage, it feels like the way that we’re phasing this because it is a pretty significant level of transformation that we’re doing across our supply chain, and we need to be thoughtful as to when we do different phases of it, so we don’t cause any major disruption to our customers, which is why it’s going to take three years to do. At the same time, it’s also why the value probably would be pretty evenly prorated over a three-year time horizon.
