James Quincey: So firstly, in any given country, channel mix has largely recovered 2019 levels. Yes, there are some exceptions like China, which is only just now reopening, and a couple of other countries. And when I say, largely normalized, if you take something like the US, clearly, there are a number of away-from-home outlets that have dropped out of the marketplace. So there’s a tail or there’s a last piece of the recovery channel that is not going to happen overnight and may not happen for some time to come. But in headline terms, other than a little bit of positive channel effect perhaps in the first half, I think we can put a line on the channel mix being €“ or the recovery of the channel mix relative to the pandemic being a major driver of price/mix going forward.
Yes, package mix will continue to be a factor, as it has been in previous years and prior to the pandemic, Clearly, as we pursue a dual strategy of keeping consumers in this franchise with affordability and looking for premiumization opportunities, the two can somewhat offset each other, one’s dilutive, one’s accretive, but they’re both valuable strategies that need to taken forward. So I think predominantly, what you’re going to see in 2023 is the ongoing moderation of rate pricing, both as we cycle rate increases or price increases from 2022 and as inflation in general and inflation specifically to us, whether it be in SG&A, or in commodities begins to moderate.
Operator: Our next question comes from Carlos Laboy from HSBC. Please go ahead. Your line is open.
Carlos Laboy: Yes. Good morning, everyone. The Latin American bottlers keep guiding for stepped-up investments in traditional trade DSD capabilities to fully exploit this new cooperation framework they have with your firm. Do you think, this is already kicking into the systems financial performance and the model, in your view, adaptable to other parts of the world where the promise of maybe higher ROIC and stepped-up bottling CapEx, can drive system growth?
James Quincey: Yeah. Let me take that in parts. The features that we have in the long-term relationship model in Latin America, we’re rolling those out in a number of other places. And clearly, the more we can intensify whatever the framework gets called, the degree of alignment towards investing to capture the opportunities in the marketplace, the better off we’re going to be, us and our bottling partners, in any given geography. So absolutely, we continue to see opportunities to work even closer together to capture opportunities in the marketplace. The nature of those investments, the nature of the opportunity are not exactly the same as Latin America. Clearly, the trade structure differs around the world. Latin America has a number of particular features that not necessarily replicated in the US or Europe or Japan, for example.
But the overall concept of a tighter longer term investment focus on the opportunities is really going to drive — continue to drive performance into the future years. And I think, in Latin America, we’ve got a great business there collectively as a system because we focused on investing into the marketplace and into the traditional trade for a very long time, along with all the other customers in Latin America. But there are still plenty of opportunities to go both from the top line and from the point of view of improving returns. So I think you’ll find or everyone will find that the Latin American bottlers, as bottlers around the world are — that we see a lot — collectively, we see a lot of opportunities ahead of us to drive the top line and to continue to improve returns on the bottling assets.
Operator: Our next question comes from Andrea Teixeira from JPMorgan. Please go ahead. Your line is open.
