Bros is a company that was founded approximately over 30 years ago in Grants Pass, Oregon. And much of, you know, it's been, you know, it's, you know, slow and steady growth, you know, since then, that's now led, you know, to the brand having over 800 stores. Texas was a major expansion, you know, for the company, achieving over 170 stores in just the past couple of years. I wanted to get a sense of what you've learned, you know, from Texas as an expansion market, opportunities that we may have, both within Texas and also other non, what I'll call non-core, meaning non-West Coast markets, you know, for Bros going forward. Absolutely. I think that, you know, we've learned two things, I think, which have been really core to who we are. So I'll start with just our base. Our brand is about the strength of the brand, and that opening in a brand new market and having so many new customers find us so quickly really just speaks to the strength of this brand. And then, two, the most important part about who Dutch Bros is, is our people and our people system. And so all of our growth is predicated on having operators that are ready to go and open a new market and open a new shop, and that's exactly what we've done with all of our new markets, including Texas. So we have 350 qualified operators in our pipeline, with an average tenure of 7 years with the company. When we open in a new city, we'll send an operator there who will eventually have on average right now of about 3-4 shops with them, but they'll start with just that one shop as we're building ourselves into the community. That model has continued to be really successful for us. When you look at our recent growth, you know, one of the things that we have learned is in thinking through what does the pace look like? Where do we put the shops? What's the right order to put the shops in? So, we've learned a lot from our operations teams and kind of their thoughts on that. Then we've also been able to add to our analytic modeling now with all of the new shop growth that we've had in the last couple of years. So a couple of things coming out of that as we look forward, one is, we're looking at as we expand in a market like Florida, which we just opened in, thinking through what is the right order to go into, like Orlando in? Where do we put the first shop? Where do we put the second shop? How far apart are they? And then at what pace should we fill in? And so we're learning a lot from our recent experience and, you know, just continuing to, on the margin, look at how we can, how we can even do that better as we go into new markets. We're also looking at, you know, how we expand in leases, what our, what our build types look like. So, we'll, we do have some end caps in our system where you'll have a drive-through still. We're all drive-through. But continuing to look at other ways that we can actually reduce build costs as we continue to go. And then, we look at the mix of types of leases we do. And so we do, we do probably more ground leases than a lot of folks out there. And so just looking at that mix of what do, how much build-to-suit, how much ground lease, we're always looking for the best site. I don't know their exact numbers, but in Texas, we have, you know, 61 stores, approximately. Greater Dallas, 35, Houston, 29, San Antonio, 21, Austin. That's according to us looking at a map on the web. So assuming that is a close, right. So was the experience in those four key markets similar across Texas, or, I mean, was there any significant variation that makes sense to point out? Maybe one was a positive outlier, one was a negative outlier. And, you know, obviously Florida, you know, many companies South Florida is either their number one, two, or three market in the country. So- Yeah. Yeah, will that be the same for Bros, and how do we get that? Yeah, I would, I would start by sharing, most things are generally the same. So one, in our newer markets, we do have about half the brand awareness that we have in our legacy markets, in places that we've been for longer. So in all of our new markets, there's really that ability to build, to build into that brand awareness. The other piece is, is one of our core strengths is really around our energy drink business. And what we've historically seen as we go into markets, that's something that, it's very popular, especially with young customers, that ability to customize an energy drink that is very, very new to the market. And so as we see, as we go into new markets, that we have that ability to really build that into a higher percentage of our portfolio, like we have in our existing markets. I think the other thing we see is, and probably, you know, very unlike when, like, we first went into Phoenix, Arizona, where we had very, very low AUVs and people didn't even know who we were. Now, when we go into markets like Florida or in Texas, there's a lot of really, you know, strong brand love and fans already existing in the market. And so I think that the national presence and the national awareness of the brand is something that has changed over time. Yeah, awareness, obviously, it can be driven by physical locations. It can be driven by people that have been in different markets, obviously social media, you know, have people doing free marketing for you and the genuine passion that they have for the brand and their willingness to share that with others. You know, but let's talk about your traditional marketing and your ability, you know, to benefit from the scale that you now have. Our estimates show you having around $1.7 billion, approximately, in sales in fiscal 2024. So how does that marketing equation change, and how might you be able to benefit from that? ... Yeah, so a couple of things. I think if you look at our marketing strategy, one, from an innovation standpoint, is that at this scale now, our suppliers really wanna work with us to do unique things, and we have kind of that wherewithal and the scale to really go and develop new things. We launched a protein coffee, protein milk coffee this January that we're very pleased with. And that was something that we were working closely with our dairy suppliers to really develop our own proprietary protein milk for that. So the innovation piece really benefits from the scale because of our ability to work with our suppliers and do new things. Then we're also still small enough that we can actually move quickly and get things in the market as we see really cool new trends happening. The second piece from a paid media perspective, scale certainly benefits that. And as we grow, you know, not only are we, I think, experimenting with new things, but also just learning what works best for us. I would say, you know, a year ago, we were doing primarily retargeting and more performance marketing, and so kind of finding people that had already found us and just encouraging them to come again. And we... Over the last year, we've really expanded that into building brand awareness, and so finding folks who should love us but don't really know about us yet and giving them a little more immersion into the brand with kind of richer content like video. We also have done some work in broader-based promotions, and the goal there is to say, "Hey, the best way to be introduced to a brand is by a friend who loves it." And so that multiple space promotion really allows someone who loves our brand to get an extra beverage to take to a friend and introduce the Dutch Bros brand to their friend. And then finally, the rewards program. We have a very strong rewards program, and in the last couple of months, we've reintroduced an introductory offer really to in those new markets to make sure that we're getting folks into a place where we can speak with them directly and share all of the fun things that we're doing. I have not seen a brand achieve 65% of its transactions on rewards in such a short amount of time. In fact, I don't think anyone has 65% of anything, and regardless of how long your rewards program. So can you talk about your, you know, success, your immediate overnight success with Digital Dutch Rewards and what you can do with that? Has that been fully optimized and where we can go from here? Yeah. So I would say, I mean, I think having been in the consumer brand market for a couple of decades now, I've never seen customers respond the way that they do to our brand. And I think the rewards program is no different than in other places and within our brand. And so the rewards program, we have been on a journey. We just launched the rewards program in 2021, so it's still actually relatively new with that strong penetration. The other thing is we've had that strong penetration despite that really strong growth in shop sales. And so to keep that level of penetration while we're growing shops means that we have a lot of new customers joining our rewards program every single day. I think that we're really, I would say, at the, I don't know, if I am good with baseball analogies, which I might not be, the second or third inning of our rewards program. So, somewhere along the beginning. And about this time last year, we actually made a switch where we had a very rich base program, which we took down the base rewards, and then that—what that has allowed us to do is to do more incentive type rewards, to find, help you find something that you love, help you find a new J part that maybe you hadn't explored before. And so, we've been doing... Right now, I would say we're still at the stage where we're just starting to segment our customer base. So I think if you think like that, where you eventually might wanna go with the rewards program, it's really the one-on-one and the personalization of it. We're still at, I would say, like, kind of that mass segmentation level and are learning, and continuing to kind of tighten that and adjust that. Mobile order pay is something we've talked about before, and you've now committed, you know, to piloting this in, I think, a couple of markets in 2024. Did you imagine, you know, just that mobile order pay functionality being added, you know, to Dutch Rewards? Talk about the integration that the customer will see. Talk about the integration in the stores and what you're expecting from this, important program. And I will just say, mobile order pay is over 30% of sales at Starbucks. So clearly there's a use case- Yeah. -that you haven't yet, developed yourself. Yeah, absolutely. So if you look at our app, the number one thing, the number one functionality that our customers are asking for is that functionality around mobile order and pay. So we know that there is a strong want to have that functionality. And I think, like, just taking a step back is one, our app is very already very popular with how folks are using it. But it, but mobile order and pay really allows you to explore the menu in a different way. And so a lot of what we're doing with this strong growth is educating new customers on who we are and what types of drinks you can get. The functionality alone of having that ability to customize a drink, know what categories you are, we believe is gonna help drive that kind of brand awareness and richness, that we would like to have with our customers. The other piece is that oftentimes decisions, as you know, coffee and beverages are a high frequency business. But as you're thinking and planning your day, whatever line you waited in at Dutch Bros, that was your longest line, is kind of the amount of time that you need to leave when you're going to Dutch Bros, if you're going before a meeting or something like that. And so what mobile order and pay does is we believe that it could really introduce a new occasion where you wanted Dutch Bros, but you said, "Well, hey, five times ago, when I went, the line was a little longer, and it took me 15 minutes to get through. I don't have that time today, so I can't go to Dutch Bros." And so I think that there's this occasion that it allows. The other piece is the way our shops are set up. So we are drive-through only, but we have a walk-up window within our shops. And so if we can, and the drive-through channel is much more used than the walk-up channel right now. And so if we can have some of the drive-through traffic kind of park and come to the walk-up window, the visual impact of the lines as you drive by is just different for our customers. So lots of reasons as to why this makes sense for us. And now, you know, as we test and go along, we're gonna be super thoughtful. Our service is what differentiates us. It's having the conversation at the window. It's having the conversation as you pull up in your car. And so as we roll out mobile order and work through all of the operational pieces of it, that's really our primary focus, is ensuring that we still have that connection with every customer that comes up to our shop. You know, it's interesting, you know, as I mentioned, you know, Starbucks mobile order and pay at 30%. Just to consider, you know, the fact that your beverage sales on a per box basis is almost identical to Starbucks, very close, you know, at around $1.9 million or so for, you know, traditional, traditionally located, you know, stores in the U.S. Yet you have a much bigger breakfast business or morning business, I should say, than you are, basically twice the size. So, you know, does mobile order and pay, does Dutch Rewards give you an opportunity to lean in harder in the morning day part, which, you know, ironically, the coffee company is actually where you under index? Yeah. So I do think that the morning is a time where our customers are most pressed for time. They're trying to get somewhere. And so again, taking that time piece out of the equation and being able to have Dutch Bros without thinking that you might run into something that might be longer than what you think is really important in that morning day part. Okay. And another big part of the, you know, sales difference between the two, if not the biggest part of the sales difference between the two is food. You know, you were, you know, previously... You had a professional responsibility for food at Starbucks. I just asked this question based on your resume and professional experience. So as you see the opportunity of developing a food program, not just to drive total sales, but to sell more beverages, you know, most importantly, you know, do you think that's an opportunity? And within the current 450-900 sq ft box for Bros, is it in fact even physically possible? Yeah. So I think, you know, taking a step back, we're really, really focused on rolling out mobile order this year. We're focused on the innovation that we've got coming throughout the year and that we're, that we're sitting with right now. And, so that's certainly our primary focus. I think if we take a step back and look at adding, you know, sales layers over time, we're always looking at, you know, what, what, what others in the market are doing, what things our customers might like. I do think that, that food is important to, to the morning day part, as you think about, you know, making one trip versus two. But there are things, you know, like the Protein Coffee, that also, you know, are something that can be highly successful in that morning day part as well. Okay. You know, we spent 2023 in many cases using a labor model that was more based on transactions as opposed to total sales. And you know, certainly there were some efficiencies you know that were gained within the stores from in 2023 that one could see on the P&L. As we think about 2024, you know, perhaps an opportunity might be around throughput, the number of customers that you can get through a line, particularly at peak day parts. So you know, so do we have you know, do we have that opportunity? And you know, is there, is there, is it a sales opportunity, or is it a combination sales and cost opportunity as we think about you know, the model evolving from here? Yeah. So as we, as we look at throughput, I think, with the lines that we have, there's always an opportunity to try and get our customers through faster. And, you know, so as we are running the business, we have a number of initiatives that we look across. So one, we think very carefully about labor deployment, how many people are on shift, and are they on shift at the right time? And so we've again, we've added more technology to our labor scheduling and have gotten tighter around understanding how our labor is scheduled versus our forecast. And, and really, it's, it's mainly about making sure that we have enough people at those peaks to really serve our customers quickly. So that's the, that's the first piece along those lines. The second piece is, we've been doing a lot of work which around our POS and kind of what screens the POS buttons are on and how quickly you can take an order. So that also helps with throughput, and it allows, you know, instead of our baristas being focused on my iPad, to be focused on our customers. So, you know, things that enhance the customer experience and are driving throughput at the same time, are things that are important to us. Just if I can add, thinking about 2024, we're gonna open up the valve, right? So we're gonna get ready with mobile orders. We're gonna optimize that walk-up window, optimize the drive-through. We're not in a position in 2024 to really start to move on a lot of the labor because we want it available and there. Okay. And then as we move into 2025 and we roll out order ahead, then we can look at optimizing, making the job easier, making the beverages easier, all of the logistics behind it. So there is opportunity, but we- we're wise to sort of pace this thing in. In approximately 100 stores or maybe a couple more than that now, you know, I think specifically around your energy product, which is around 25% of sales, that makes it easier, you know, for the Broistas, you know, to do their job faster, more consistent, easier, a lot less waste, you know, for example. So, you know, talk about how big of an idea, you know, that is both for new and existing stores. And, you know, are there other opportunities like that? I'm gonna use the word to modernize, you know, the internal workings of the box. Yeah, we believe that there's a number of opportunities there. So we've recently hired a president of operations, Sumi Ghosh, who has, you know, significant experience in looking at throughput and looking at, you know, how to kind of best design our box to maximize that for labor deployment and also for speed as we come through. You know, and specifically looking at the taps for this year, we're prioritizing putting the taps in new shops as we look at the amount of equipment we have and things like that to go. That it's, you know, it's certainly easier to put it into new builds than into existing shops, and we have so much in front of us. But that's a big opportunity for a couple of reasons. So, one is that we're bringing in cans to the shop right now. So just that sheer amount of cans that we actually have to take care of on the back end is something that is not super fun for the Broistas. So that's a big difference. It's also, you know, better for the environment with our, which our Broistas support, and it's something that, you know, can be faster as we go through the shops. Okay, I mean, you mentioned, you know, you're President of Operations. I mean, we also have the new CFO, you know, coming in, MOD Pizza in Starbucks, a new CMO who is already in place, Tana Davila in CKE, and you have a new Chief People Officer as well. So it's a lot of C-level talent, you know, that, you know, that's been added to the, you know, to the company, including yourself, not much longer than a year ago, from what I remember. You know, so, you know, talk about, you know, as you you know the vision of the company, you know, including, your Executive Chairman, you know, Travis Boersma, you know, the vision of the company in the next three years, you know, maybe how you would like it to look different. You know, a lot of the functionality and the talent that you've added to the organization and specifically how, you know, Bros would evolve in, you know, let's call it 2026 versus what it was in 2023. Yeah. So, again, I'll start with, like, what we're keeping the same. So one, I think all the new leaders are on board now. They're still in their immersion periods, most of them. Tana been our CMO, has been on board for a bit longer, so she's very actively involved in running the marketing team. You know, but I would say we're making sure that everyone is passing their flow check, which is how you learn how to make every single beverage and know what it feels like. Sumi, in particular with operations, has been in 4 or 5 different markets, got to open our busiest store ever in Orange County, California, and got to see the mile-plus-long line at 4:00 A.M. before we even opened. And I think is just in awe of how incredible, incredible the brand is. So we're really spending a lot of time immersing the leaders. And even before that, you know, what's important to us is that it's our people, and it's people who are servant leaders. And so making sure the folks that we're bringing on board have the same heart of those that are overlapping and staying with us for a while. But but eventually want to go do something else. And you know, Sumi is coming in for our existing COO, who's been with the business for over 30 years and will remain with the business. And so they partner together. They've been sharing an office. They've been traveling together. It's been just, you know, across the board, incredibly smooth transitions, really giving everyone time to learn, immerse in the brand, understand what makes this brand really special. Like, you know, let me ask you about the economy. I mean, we have, you know, California, you know, everyone's wages in quick service of any kind of size is going to $20 base pay before tips. Mm-hmm. You know, so that's one micro economy. Other parts of the, you know, of the, of the country used to pay, you know, a much lower minimum wage and had your Broista, you know, compensated, you know, in some cases, even the majority on tips. And yet, you know, that might not be exactly the way that your consumer, you know, can spend at your brand. In other words, maybe the California consumer doesn't necessarily have more money to spend than the Tennessee consumer does, just as a for example. So, you know, how do you balance, you know, some of the unique cost challenges, you know, with how the brand is priced and, you know, how, you know, how much, you know, local adaptation of the brand, you know, and from a cost and a pricing perspective, are you currently experiencing? Yeah. So we do have pricing tiers across the country. And, you know, we largely look to understand what the market looks like, what the customer looks like. And so we do all of our pricing on, you know, what the customer thinks is fair and right to pay for things and have done, especially in the anticipation of understanding what might happen with the FAST Act. We've done a lot of pricing work, not only in California, but really across the brand, to understand where we fit. So we feel like we have a strong strategy going into the April move in California. I would also share, you know, I think that in general, what we're-- we also serve hospitality workers. They love our service. And I think that that's something. It's not something that we necessarily measure analytically, but something that every time I'm in a shop, they share with me, like, just how many people who work in the service industry are coming through the drive-thru at Dutch Bros. And so I think one of the things we don't know about California is this is definitely putting also more money in the pocket of customers. And so I think none of us understand, you know, how that could potentially play out as well. It is interesting, you know, Starbucks had their annual meeting. McDonald's was at it, like, an investor conference this week. Starbucks, you know, talking about some weakness in their occasional afternoon treat business still continuing. McDonald's talking about an expectation that that overall traffic for the category to be negative in fiscal 2024 as their consumers, at least in the lower end, is trading to food at home based on the pricing that's been taken in the restaurant industry. Those are two big brands, big companies, that both have, you know, some negative comments to make on a consumer that actually might be yours in a lot of cases. So, you know, as we, you know, as we are webcast, I mean, can we, you know, talk about, you know, the perceived health of your consumer and, you know, maybe, you know, short-term outlook, you know, in terms of their ability to continue to spend and visit the brand, maybe as much as they want to? Yeah. So, John, when you talk about Q4, where we really saw strength, a very strong 5% same-store sales, that was led by a sequential improvement in traffic. We also saw strength in our afternoon day part that helped drive that strength across Q4. And, you know, again, we're really pleased with what we saw with our customer. Our holiday LTOs performed very well during that time period. The customer we've seen, you know, continues to shift to iced beverages, which really I think favors, you know, that portfolio of beverages that we have and what we're known for. And then we also shared on our last earnings call that, you know, I think like others, we did see some weather impacts in January. But outside of those weather impacts in January, we're very pleased with the trends and results we were seeing. Okay. You know, and, you know, as we've, you know, we've spent a lot of time on Texas, obviously part of it, you know, other markets where you have been expanding in Alabama, you know, Tennessee, I think, you know, you'll be in Kentucky, and maybe you are in Kentucky, you know, already. So, as we kind of continue the some of the Southeastern mark, you know, march, you know, how, how are some, how are some of those non-core developing markets performing well against your initial expectations? So again, as we open a new market, our customers are finding us. Our super fans are finding us. And one of the things that's neat to see is we do sticker days about once a month across the brand. And, you know, the popularity of those things, where we do stickers or we do friendship bracelets, things like that, they really continue to be strong across those new markets. And then, I would also add to that, I mean, we're seeing similar things that we see in some of our other markets where the brand awareness is low. So the super fans find us, but it's really that next introduction and again, working through ways to continue to speed up that brand awareness piece as we go into new markets. It's, you know, it's a delicate balance as you go into these new markets and have very high volumes, especially when there's, you know, not a shop in a place, and how quickly can we infill to take some of that balance off of those shops? So, you know, we're seeing lots of things, I think, that we're getting used to in those new markets. You know, you, you're not asked this often specifically, but, you know, you are going into markets with different competitive sets, Sonic, mainly in Texas, for example, nearly 1,000 units, very big, and has a very big beverage business, particularly afternoon beverage business. You know, you are high returning, you know, you're high returning box, relatively simple to, you know, simple to open, at least from a construction perspective, much harder to run and develop a brand. So, you've invited competition into the market. There's several trying to do what you do. It's very hard. Execution and building culture is its own special thing. So talk about, you know, as you come into markets and haven't been first- Mm-hmm. You know, as you have, you know, kind of come in and maybe remind people of others how, you know, how the consumer has responded, you know, to maybe changing some of their existing habits and coming to yours. Yeah. So you know, I would start with, we are based in the Pacific Northwest. We have grown up among a lot of competition in the Pacific Northwest, and so we are not, we are not unused to, being a place that customers need to, you know, have many choices to choose among. You know, what I would say is we really, really resonate with with a younger customer. We resonate with someone who's looking for not only a beverage, but that service to brighten, brighten their day. I think the number of stories that you hear across our shops of someone going through a difficult time and a Broista just making their day for it, we celebrate those stories. We encourage, you know, all of that to happen within our shops. And, you know, I think what we're finding is that service model is truly unique. And, and that is really what drives customers to come to us, it drives customers to experiment with us. And what we see is once a customer comes over to Dutch Bros, the visit satisfaction is just incredibly high. And so that as we gain them as a customer, they seem to continue to come back. Excellent. Thank you. Thank you. Very good. Thanks, John.