I would say, to answer your question sort of philosophically, we will never ever, ever be done trying to drive supply chain efficiency and supply chain excellence. And we’re not done for two reasons. One, there’s an opportunity to – if we can push more units to a fixed cost network, certainly, we can enhance margin. And that’s just straight math, right, Jim, that’s easy. I think the second part of that is the more units we can get through our fixed cost network, we create what I’d like to call, non-CapEx capacity. And that allows us to fill customer demand. It allows us to manage our schedules. So we’re producing at the most time – effective time of the quarter, the month and the year. And so there’s a lot of advantages to continue pushing on supply chain excellence and free up any amount of shop capacity that we can in our network.
Jim Salera: Okay. That’s great. And then maybe if I could sneak in one more question. Just thoughts around CapEx spend in 2024, obviously, coming off a big lift with Midlothian and getting that up and running either like a dollar amount we should think of or percentage of sales, whatever is easier for you guys to just think about that for 2024?
Greg Gaba: Yes, Jim, in the prepared remarks, we gave an estimate between $25 million and $30 million for CapEx in 2024, and we feel pretty good about that range.
Jim Salera: Perfect. Thanks, guys. I hop back into the queue
Brian Kocher: Thanks, Jim.
Operator: Your next question comes from the line of John Baumgartner with Mizuho Securities. Your line is open.
John Baumgartner: Thanks. Good afternoon. Thanks for the question. I wanted to come back – first off, I wanted to come back to operating leverage and specifically at the SG&A line. The last 9 months showed some pretty solid improvement there. I am curious as to how you are thinking about SG&A in 2024 as volume drives the top line. I mean is there any reason to expect a material uptick in SG&A spending? Are there incremental resources you need to add as you go forward? Just trying to understand how SG&A evolves from here. Thank you.
Greg Gaba: Hey John, great question. Thanks for asking that. How I look at ‘24 is pretty similar to our SG&A as a percentage of revenue as it was in ‘23. In Q4, it was a little bit lower, the percentage. That was due to all of the change, change in leadership, change in the – with the divestiture of the frozen fruit business and there was a bit of a reversal of stock-based compensation in Q4. And you will see that on the cash flow statement. But going forward, we are roughly 12.3% SG&A as revenue – as a percentage of revenue, and I would view that to be pretty similar in ‘24.
John Baumgartner: Thanks for that. And then coming back to the comments on the mid-single digit all outlet growth for plant-based beverages, obviously driven by away-from-home, are you seeing any sort of commonalities in terms of where the away-from-home channel is gaining that acceleration? Are there certain sectors adopting plant-based for the first time, like universities or hospitality? Is this still largely coffeehouse driven? I am just trying to figure out, understanding better the TAM, how the TAM is evolving across the verticals in away-from-home.
Joe Ennen: Yes. John, it’s Joe. We are definitely seeing that driven by coffee shops. What you are seeing is, and this isn’t a new trend, we have seen for years and years the migration of consumers from cow dairy to plant based. Additionally, you see coffeehouses putting an increasing emphasis on the promotional drinks featuring plant based. All one has to do is look at the menu board and you will see a plethora of plant-based specialty drinks. And so between the consumer shift and then the coffee shops enthusiasm for promoting and pushing specialty drinks, it has been the same drivers for several years now, and we would expect those to continue.
John Baumgartner: Great. Thanks Joe. All the best.
Joe Ennen: Thank you.
Greg Gaba: Thanks John.
Operator: Your next question comes from the line of Brian Holland with D.A. Davidson. Your line is open.
Brian Holland: Yes. Thanks. Good evening. So, I think this has been addressed in a few different spots, but maybe just to tie it all together. So, it sounds like on whole plant-based beverage growth around mid-single digits has been the trend here for a little while now, stronger in foodservice, a little softer in what we can see in the tracked channels. Just want to make sure I understand, to the extent that this is possible to look at it this way, what needs to be assumed for category growth that underpins your outlook? Are we still sort of like on whole mid-single digits? Is it a little bit softer than that, a little bit stronger than that? I just want to make sure I am sort of centered there.
Brian Kocher: Yes. Brian, really good question, I think the way to think about this in terms of what underlies our outlook is, remember, we don’t necessarily start off our outlook and forecast with a category growth number. We start off with the growth forecast from our customers. And so then that gives us, obviously, insight to where the category as a whole is growing. Now, that’s sort of insight into the process that we have. But ultimately, I would say the growth that we have with our customers would translate to a category that’s growing in the mid-single digits. So, they happen to be very aligned in this example.
Brian Holland: Okay. And if I just kind of follow-up on that, so maybe ask the question another way, because I think this was an issue a few quarters ago where maybe some assumptions were made about the category, the category softened and some plans changed. Any sense as you talk to your customers on whole that some of the slowdown in that category that we have seen, where we have seen it, in tracked channels and the like, that they have gotten a little more conservative about those assumptions over the next 12 months relative to maybe the prior 12 months?
