We’ve definitely seen some service challenges and even parts, but I think we’re working through that. Like I said, maybe sometimes we have to buy a little more equipment and repair, but whatever we got to do to make sure the operators can get their businesses open or we have options and we try to execute it at every level on whatever we need.
Joshua Long: Thank you.
Jerry Morgan: Thank you.
Operator: Your next question comes from the line of Sara Senatore with Bank of America. Your line is open.
Sara Senatore: Great. Thank you. I know we’ve spent a lot of time talking about margins, but I do have a few, just two follow-ups. The first is on, you mentioned your purchasing department doing really well with locking in prices. Could you give a little more color like what that was? I know beef is typically harder to lock in. Were the benefits and from some of the other commodities in your basket? And then the second question is, could you just talk a little bit about the margin shouldn’t structure for off-premise or to-go versus dine-in. It looks like your mix of to-go with pretty stable year over year. And I think part of what has been maybe upward pressure on labor hours has been shifting back to more dine-in, but to the extent that that wasn’t the case. Is there anything you can kind of talk to about what a stable mix might mean going forward in terms of labor hours or just margin structure overall? Thank you.
Michael Bailen: Hey, Sara. It’s Michael. I can touch on those. So certainly from a purchasing standpoint, it’s largely around beef, but it is everything. Knowing when to lock in and knowing when to be buying on a formula basis and what weeks to maybe go a little bit heavier into the buying, just the fact that they have their fingers on the pulse of what’s going on there and doing everything they can to time that as best they can with the knowledge of how busy we are and making sure that the supply is there first and foremost, but that goes for all items in the basket. And just having those long-term relationships with our vendors, treating them right, being good partners with them through COVID really pays off now when it comes to making sure we have what we need going forward.
And as far as margins in the restaurant, dine-in versus to-go, I can take the expenses and allocate them to different areas and give you different answers. The easiest way to go about that is if I look at a Texas Roadhouse with a busy dining room and look at it with to-go levels pre-COVID or today’s higher volumes, the margin dollars at the no-brainer are much higher, and then the margin percentage is slightly higher. So it is a benefit from a margin percent to have the higher to-go volumes, you’re getting leverage in different areas. You are right that as we see more of our traffic over the last year shifting back into the dining room, there is a labor component to that and where you have to be a staff to serve those guests. And so that also plays into what labor may look like going forward.
If we grow to-go more than dine-in, maybe you don’t need as much labor as you would to serve more dine-in guests. So those are the things that we look at and every restaurant is going to be a little bit different as far as what opportunities they have and the impact of growth on them.
Sara Senatore: Thank you so much.
Operator: Your next question comes from the line of Dennis Geiger with UBS. Your line is open.
Dennis Geiger: Great. Thank you. Recognizing it, it may be early here, but curious if you could comment at all on 2024 restaurant margins, directionally at least, relative to 2023. I know you shared some of those comments as we’ve gone through the year for this year. So I’m curious if any comments there, or even specifically the COGS piece in 2024, thinking about that relative to 2023, anything to help sort of level set us at this point? Thank you.
Michael Bailen: Hey, Dennis, it’s Michael. It’s a hard one to fully answer. There’s a lot of things at play. What side of the range is on our inflationary guidance, where we might land, and what type of pricing we take? But if you want to take an assumption of moderate pricing going along with what we already have in a positive macro environment, I think the math would play out for some opportunity for overall leverage in restaurant margin percent, and the dollars continue to grow, certainly, but the percent’s moving in the right direction, and whether that’s every line or we shall see it again, going back to what level, where in those inflationary ranges we might fall.
Dennis Geiger: Appreciate the color. Thanks Michael.
Operator: Your next question comes from the line of Brian Harbor with Morgan Stanley. Your line is open.
Brian Harbor: Yes, thank you. Maybe just a follow-up on that also, as you think about G&A next year, you probably don’t have a budget yet. But any, should we expect kind of normal inflation in that line? Any kind of special projects you think we’ll add to that, or just any high-level comments on that part?
Michael Bailen: Yes, Brian. It’s Michael. Yes, you are right. That’s still, that’s a process that we continue to go through of setting those G&A budgets for the year, but I do think it’s a continuation of our normal plan of wanting those G&A dollars to grow at a lesser rate than our revenue is growing, and so you continue to get a little bit of leverage on that G&A as a percent of revenue, maybe not a dramatic change. We’ve obviously seen a G&A percentage come down quite a bit, and that could continue in the 2024 as well.
Brian Harbor: Okay, great. The commodity inflation outlook you laid out for next year, would you characterize that as conservative at this stage? How much do you think you have visibility on, especially the beef side? I realize the wild card in the beef market is just demand and how that plays out, but how would you characterize your visibility relative to maybe prior years?
Chris Monroe: Yes, I think we’re taking a middle of the road, conservative, look at it, a realistic look at what is going on. I think, certainly, again, our beef experts are giving us their best thoughts on where things will be, but you’re right, there are a lot of puts and takes that can move things, where retail demand comes in. I think it’s very much clear that supply is moving down, we’ll just see where the demand goes. So there is a lot that can move around, but we’ve given you our best realistic thoughts at this time.
Brian Harbor: Okay. Thank you.
Operator: Your next question comes from the line of John Tower with Citi. Your line is open. Mr. Tower, your line is now open. Your next question comes from the line of Brian Vaccaro with Raymond James. Your line is open.
Brian Vaccaro: Thanks. Good evening. Just back to the sales performance. So, you’d obviously mentioned the strong comps when they moderated through the quarter, but then they picked up pretty nicely in October. Just curious, is there anything to glean from your data that could shed light on what’s driving that improvement? Any outside strength in a weekend, weekday, or regional, or any changes in consumer behavior you might be picking up?
