Greetings and welcome to the Grocery Outlet Fiscal Q3 2024 Earnings Results Conference. At this time, all participants are in listen-only mode. A brief question-and-answer session will follow the formal presentation. We ask that you each please limit yourselves to one question only. Should anyone require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Christine Chen, VP of Investor Relations. Thank you. You may begin. Good afternoon and welcome to Grocery Outlet's call to discuss financial results for the Q3 for the period ending September 28th, 2024. Speaking from management on today's call will be Eric Lindberg, Chairman of the Board and Interim President and Chief Executive Officer, and Lindsay Gray, Interim Chief Financial Officer and SVP of Accounting. Following prepared remarks from Eric and Lindsay, we will open the call for questions. Please note that this conference call is being webcast live and a recording will be available via telephone playback on the Investor Relations section of the company's website. Participants on this call may make forward-looking statements within the meaning of the federal securities laws. All statements that address future operating, financial, or business performance or the company's strategies or expectations are forward-looking statements. These forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from these statements. A description of these factors can be found in this afternoon's press release as well as the company's periodic reports filed with the SEC, all of which may be found on the Investor Relations section of the company's website or on sec.gov, and now I will turn it over to Eric. Good afternoon, everyone, and thank you for joining us. Before we get into the review of the Q3, let me just acknowledge that we are reporting our results in a transitional moment. Last week, we announced that RJ Sheedy agreed to step down from the President and CEO positions and from the company's board of directors. I want to thank RJ for all of his contributions over the last 12 years. RJ has played a critical role in scaling and evolving our business, helping to set our foundation for the future. I have returned to Grocery Outlet full-time, serving as Interim President and CEO. This is my first week in the role, and I can honestly say that I'm really excited to be back, working closely with the Grocery Outlet team and our independent operators again. The board has retained a leading global executive search firm to begin the process of hiring a permanent president and CEO. Until then, I'll be fully engaged in the business, plan to make significant progress on the priorities, which we'll share more details on during this call. As I told our team and our operators last week, and I'll reiterate to you today, we have made a leadership change, but we are not changing our underlying strategy or commitment to what has differentiated us for almost 80 years. Grocery Outlet delivers unbeatable value, a unique treasure hunt shopping experience, and amazing customer service through our best-in-class, opportunistic buying model and independently operated neighborhood grocery stores. We have proven over many years that when we execute, our value proposition resonates across demographics, geographies, and almost any macroeconomic environment. This transition is about refocusing on strong execution and doubling down on that differentiated value proposition. I'd like to share my perspectives on four areas: where we are today, our Q3 highlights, where we'll be focused in the near term, and implications on our guidance. Let me start with where we are today. First, on systems. In August of 2023, we transitioned to SAP from our legacy systems and experienced significant issues, including poor data visibility, slow system speeds, and a loss of tools and functionality. These issues hurt our buyers' ability to write purchase orders efficiently, our inventory planning and supply chain teams' ability to accurately manage inventory, and our operators' ability to see real-time inventory in their order guide to bring product into their stores. The impact on the business has been significant, and we have made substantial progress over the last year, including ending operator commission support. While the new system is fully functional, work remains to improve visibility into additional operating data, to increase speed, and to refine the tools that we and our operators use to manage the business. This work is critical to executing our dynamic business effectively. Next, on execution. The disruptions from our systems transition strained our organization and resources, making execution of the core business more challenging. Furthermore, we have a list of great growth initiatives that we've covered with you on previous calls, but upon reflection, we probably have tried to do too much at once, further impacting our everyday execution. We aren't going to stop pursuing any of these exciting initiatives we have, but we need to be measured in the pace of the rollout as we prioritize our execution, and finally, on value. As discussed on the call in Q2, we missed the mark on value earlier this year due to a combination of pricing actions we took to reestablish healthy margins that coincided with competitive pricings that picked up. For years, we have measured our value to deliver customers through a series of metrics. First, the total percentage savings we deliver customers on their basket. We target approximately 40% savings versus conventional grocers and approximately 20% savings versus discounters. Second, we target price parity with deep discounters on a list of key commodity items, for example, milk and eggs. And third, we measure the share of sales we generate from items with more than 60% savings versus conventional retailers. This captures the extreme value, the treasure hunt experience in our stores, and represents the deals that our customers tell their friends and family members about. As we look at these metrics, we are feeling confident about where our overall basket savings level and commodity pricing are sitting right now, but still have some work to do on delivering the extreme 60% value items on a consistent basis to our customers. We made strong progress on restoring value through Q3, and our relative value has improved. Our value is strong, and we are on the right path to where we want to be. We just need to execute better in this area. Let me share a bit about Q3 results. While we are disappointed with our weaker comp store sales of 1.2% given the execution issues I mentioned above, we delivered strong double-digit top-line growth. Our two-year stack comp was a healthy 7.6% ahead of our long-term algorithm. Our comp transaction count was up 2% in Q3 and 10.6% on a two-year basis, showing that despite execution challenges, our model continues to resonate. We opened five net new stores, increasing our store count to 529 locations at quarter end. Our new store growth algorithm is back on track. Our gross profit margin was on plan, and this flowed through to a beat on Adjusted EBITDA. Lindsay will share some more of those Q3 results in just a moment. This is a great business, and when we execute, we deliver industry-leading value through a unique shopping experience that can't be beat. My near-term priorities are to refocus on the core tenets of this model. Number one, it all starts with value. As mentioned, we must consistently deliver across our key value metrics to create an exciting treasure hunt shop every time the customer steps foot into one of our stores. The close-out buying environment remains very healthy. Deal flow is very strong, and we believe that we are still the best partner in the industry. Consumers continue to prioritize value, and we are well-positioned to capture growth in this environment. Number two, supporting our independent operators. The systems disruptions have made the last year incredibly challenging for operators, and the inefficiencies have pulled them away from doing what they love, serving their communities. Being an independent operator is not easy, and the resolve our IOs have shown this past year is just incredible. We are focusing on giving our operators the tools and the support that they need to execute their business efficiently and to amaze our customers. I really look forward to reconnecting with the operator community in person over the coming weeks. Number three, completing our systems transition work. We need the tools to operate at speed and efficiency that enable our internal teams to execute this business at its full potential. Full functionality of these tools is a critical piece of that model. In addition to getting operators all the tools they need, improving systems functionality for our internal teams is critical to improving efficiency, to increasing automation, and to reducing process workarounds that we've been forced to implement over the past year. It's simply taking our teams too long to do the basics, and lastly, I'll be working on simplifying our priorities to enable our teams to focus on execution of the core business. If I've learned one thing in my 30-plus years here at Grocery Outlet, it's that we are at our best when we're focused on executing the basics and a small set of strategic priorities. One week in, I'm still getting my arms around the detailed operating plans of the business. I'll take the time in the coming weeks, working with the leadership team, to take a step back and ensure that we are hyper-focused on the right set of priorities that will enable us to be successful. At the core, this business is about delivering unbeatable value on a relevant assortment with great customer service every day. We have to execute the basics. I look forward to sharing more with you on the next call. So having covered our current state, Q3 performance, and our near-term focus areas, let me provide some insight into the resetting of our guidance for the balance of the year. At the core, our business fundamentals are solid. We have a strong value proposition in the market. We are growing top-line sales in the double digits, and we have a long runway for growth. Our recent execution challenges we described are making this business harder to forecast than usual, harder than any time in my 30-year career with the company. In light of this, we took a hard look at our Q4 forecast and landed where we feel is appropriate, given our recent track record of forecasting and missing guidance. While we made strong progress on our relative value proposition in Q3, we recognize that we are not fully where we need to be. Restoring our value proposition has taken longer than expected due to the systems inefficiencies discussed in the competitive environment. We do not see the competitive environment as a fundamental impediment to getting back to where we want to be on value. We have a strong history of navigating changing competitive environments, and we will continue to balance value and margin with our opportunistic buying model. There are some higher expenses that we did not anticipate earlier in the year, which impacted Adjusted EBITDA in Q3 and will continue to flow through the Q4. While the new system is fully functional, we are still investing in enhancements and adding extra internal and external resources, resulting in higher costs, which should be largely temporary. In addition, our Q4 SGA estimate was a bit too low, and our updated guidance reflects a number more consistent with Q3 levels. The net result is an approximately $16 million reduction in anticipated full-year Adjusted EBITDA from the midpoint. We recognize this is a significant downward revision, and we've stared at this a lot. But given where Q3 came out and my recent return to the seat, we think this is a prudent estimate. I'd like to now pass the call over to Lindsay to share more about our financial results. Thanks. Welcome back, Eric, and good afternoon, everyone. Net sales increased 10.4% to $1.11 billion during the Q3 due to new store sales and a 1.2% increase in comparable store sales, which represents 7.6% comp growth on a two-year basis. Comp transaction growth of 2% was partially offset by a 0.7% decline in our average basket. Comps during the summer months were challenging but accelerated in September to 3.8%. Our Q3 gross profit increased 9.2% to $344.9 million. Gross margin rate of 31.1% was 10 basis points ahead of our expectations and a 20 basis point sequential improvement from the Q2. SG&A expense increased 9.5% to $304.6 million compared to the Q3 of 2023. Net interest expense increased 52.4% to $6.4 million, driven by higher average principal debt to enable share repurchases and other cash outlays to support the continued growth of the business after the acquisition of United Grocery Outlet earlier this year. Our effective GAAP tax rate during the quarter was 28.6%, an increase over the effective tax rate in the Q3 of 2023 of 18.6%, primarily driven by lower excess tax benefits related to the exercise of stock options, non-deductible acquisition and integration costs related to the acquisition of UGO, and lower pre-tax book income. GAAP net income for the Q3 was $24.2 million, or $0.24 per fully diluted share. Adjusted EBITDA increased by 6% to $72.3 million for the quarter, and our adjusted EBITDA margin was 6.5% of net sales, 10 basis points ahead of our expectations and a 50 basis point sequential improvement from the Q2. Adjusted net income was $27.9 million for the quarter, or $0.28 per fully diluted share. Turning to our balance sheet, we ended the quarter with $68.7 million of cash. Inventory at the end of the quarter totaled $396.9 million. Total debt was $429.3 million at the end of the Q3, with net leverage of about 1.5x. During the Q3, we repurchased about 1.2 million shares of stock, totaling $25 million at an average price of $21.50. Subsequent to quarter end, we repurchased an additional 1.5 million shares of common stock, totaling $25 million at an average price of $16.62 per share. During the Q4, our board approved a new share repurchase authorization for up to $100 million. This program replaces our previous share repurchase program, under which $9.4 million remained available for repurchases. The new share repurchase program is effective immediately and does not have an expiration date. Eric spoke earlier to the thinking that went into our updated guidance. Now let me run you through the numbers. For the full year, we now expect comp store sales growth of approximately 2.4%. We expect comp store sales growth in the Q4 to be approximately 2.0%. While October trends were similar to September, our guidance reflects more difficult comparisons in the remaining months of 2024 and our continuing work to sharpen our value proposition. We now expect to add a total of 66 net new stores this year, up from our previous range of 62 to 64. This includes the 40 acquired United Grocery Outlet stores and 26 net new organic store openings. In total, we now expect fiscal 2024 net sales of slightly above $4.35 billion. We now expect gross margin of approximately 30.4% for fiscal 2024. We expect gross margin for the Q4 of approximately 30.2%, reflecting typical Q3 to Q4 seasonality and investments in increasing our value proposition in our opportunistic assortment to drive sales. For the full year, we now expect adjusted EBITDA to be in the range of $237-$242 million, which implies Q4 adjusted EBITDA of $57-$62 million. Our lowered forecast for adjusted EBITDA reflects the impact of lower comps and gross margins, as well as higher SG&A than previously anticipated. For the year, we continue to expect D&A to grow in the mid-20s% on a percentage basis, reflecting investments in our systems, as well as accelerated new store growth during the year. We now expect share-based compensation of approximately $22 million. Net interest expense is now anticipated to be approximately $23 million. We continue to expect a normalized tax rate of about 32%. We now expect average fully diluted shares outstanding for the year of approximately 100.3 million, down from 100.5 million due primarily to lower share count from share repurchases. We continue to expect CapEx, net of tenant allowances, of approximately $200 million. We now expect full-year adjusted EPS of $0.77-$0.80 per fully diluted share. Finally, let me make a few comments about 2025. We will lay out our formalized guidance on our Q4 earnings call, as we have typically done in years past. Broadly speaking, at this point, we believe the full year of fiscal 2025 should be framed around a return to our long-term growth and algorithm targets, which, as a reminder, are comparable store sales growth of 1%-3%, gross margin of approximately 30.5%, and Adjusted EBITDA margin of approximately 6%, building to this full-year number as the year progresses. For fiscal 2025, we will have increased capital expenditures due to a higher number of organic new store openings and supply chain investments, and as a result, higher depreciation and amortization. We look forward to updating you in more detail regarding 2025 on our year-end earnings call in February, and now I'll pass it back to Eric for closing. Let me close with this: I'm very confident in our business fundamentals and our ability to realize our long-term growth potential. We are a unique, specialty discount retailer with a long history of consistent growth. We need some time to get back to the basics, focus on execution, and a small set of prioritized growth initiatives while enabling our passionate independent operators to serve their communities. We'd like to now open up the call for your questions. Operator? Thank you. We will now be conducting a question-and-answer session. Please limit yourselves to one question only. If you would like to ask a question, please press Star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press Star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the Star keys. One moment, please, while we pull for questions. The first question is from Krisztina Katai from Deutsche Bank. Please go ahead. Hi, good afternoon, and welcome back, Eric. I wanted to start with sales. your Q3 comp was largely in line. September was solid, but you took your Q4 outlook down. It sounds like some of that is conservatism considering the October commentary. But Eric, you talked about the need to execute better. So what are some of your first priorities to get execution under control? How much pressure are you still seeing from the system integration issues at this point? And how should we think about a realistic timeline for that to be fully behind us? It's a heck of a question. Hi, Krisztina. Let me take the first part of that, and then Lindsay can jump in. So I said doubling down on value. When the customer needs us most, we need to be there for them. So we've made a ton of progress, but we're not quite done. So we're going to continue to pull the lever on price, particularly with opportunistic, to make sure the wow's there. We are going to support and make sure that the relationship with our IOs is intact. We just need to provide them with tools so they can run their business a little bit more efficiently. I want to put the systems transition work in the rearview mirror. Frankly, I don't want to talk about this next year. I want to hear about all the great things it's doing for us, not all the things that we can't do because of the system. So that's on the list. And then I'd say really looking closely at all the priorities that we have on our list and making sure that we narrow that down. I know we win when we're focused on a short list of things that matter the most. And so that's what we're going to do over the coming weeks, is make sure that list is right on. Krisztina, this is Lindsay. I can follow up a bit. So yeah, so our Q4 guide, so we feel good about the trends that we saw in September and October. October trends were similar to September, but they did reflect a slight slowdown on a two-year basis. So also at the same time, we're facing difficult comparisons as we progress through the Q4. So with all that said, we took a step back, and we just really felt it was prudent to be a bit more cautious in our outlook for the full year and the Q4. And we have revised our guidance accordingly. So we're still working to get our value prop where we want it. And as we expect price competition coupled with the holidays Whatnot, that's everything that went into the Q4 guide for comp. The next question is from Robbie Ohmes from Bank of America. Please go ahead. Oh, hey, Eric. Nice to talk to you again. My question is, I was hoping we could just get more color on RJ's departure and also what type of CEO you're looking to replace him with and maybe related to that. Just to clarify, the systems, where is the systems disruption right now? Is it behind you, or is there still risk to the first half of next year related to that? Yeah. Hey, Robbie. Good to talk to you again. Thanks for the question, so let me start first with the CEO transition. You all know this last year has been really difficult. It's been an operational challenge year from the systems transition. We have not executed like we want, like our expectations, or like our history, and that's been super challenging. I'd say because of the relationship that we've all enjoyed working with RJ for many, many years, we were patient. We felt like that was the right thing to do, to be patient, but I can tell you, the same way that you all might have been feeling about our performance, we were feeling that internally as well, so we finally got to a point after the last board meeting where we sat down, we had a frank conversation, and we had an agreement to move forward. So I really want to make sure everyone knows that we didn't have any major disagreement. There's no new finding that you guys will learn about later. There's no other shoe to drop. This was just a little bit of inconvenient timing and sort of a function of how things played out, nothing more. The question on systems, yeah, kind of where are we today? I'll repeat a little bit of what I've said. I'm still digging into it. I'm still getting up to speed. Let me say this: the system's fully functional. We're still working on enhancements. We're still working on efficiency, which are words that just say it's not quite working to the speed that we expect. I would say full stabilization has been a bigger undertaking than we originally anticipated. Internally, that just translates. It's been more resources. It's taken more time. But I would say that we're making a lot of progress. I'll give you a couple of examples of things that I'm looking for that may address sort of your timing. The biggest thing to me is for the operators is having their real-time order guide and their new arrival order guide back. Those sound like very tactical things, but as a merchant, being able to order off of our system and be able to look at a live inventory, be able to tap into the system and pick what you want in your store, that's kind of nirvana in an opportunistic model. And so we have not had that tool. It's not back yet. When we get that back, I think we've sort of rounded towards home, and the system will be finished. It's working. The tool's working, but it's not doing for us what we need it to do completely. So really look forward to getting it, again, as I said, sort of in the rearview mirror. The next question is from Anthony Bonadio from Wells Fargo. Please go ahead. Yeah, thank you for taking my question. So just wanted to dig in a little bit on margins. Taking a step back and thinking about your EBITDA margin, we've now seen some pretty sizable swings since the pandemic began. That was obviously exacerbated even more recently with the systems issues and now some more uncertainty as you rework guidance again. So I guess maybe just at a high level, can you talk about how we should think about the appropriate margin profile for the business over a longer time frame? And then just as a follow-up, you mentioned pulling back from some strategic priorities to focus on less. Can you just talk about specifically what items you're referring to there? Yeah, Anthony, hey, this is Lindsay. I can take the first part on margins. Our long-term algorithm for margin since we started talking with you all has been 30.5%, and we still believe that's a great place for us to be. We love reinvesting the dollars that we have back in the business, and that continues to be a priority. That is our long-term algo that we still have. That's why I wanted to emphasize it in the call script as well, just because that's what we want to orient everyone to. Margins definitely fluctuate here at GO based on assortment and a variety of other matters. I definitely admit it's been a rocky few quarters with things going up and down. Just a reminder, last year we saw really high margins. Assortment was great at that time. We are delivering great value as well to the customers. So it really just changes quarter- to- quarter. So just long-term, 30.5 is what we want to orient you into, and for 2025 is where you can think of that. And then I'll hand it over to Eric. Yeah, hey, Anthony. Yeah, day five, not quite ready to tell you what we're taking off the list or adding to the list or putting higher on the list. We'll be doing that work in the coming weeks. It's really clear to me, being back a short time, that we're trying to do too much, and we're not doing it all well. The next question is from John Heinbockel from Guggenheim Partners. Please go ahead. Two quick things. One, I know you're talking about a 6% EBITDA margin next year because you want to reinvest back into price and value. I mean, Eric, do you think that are you being conservative with a low single-digit comp, particularly in this macro? Right? And then secondly, what are you looking for in a new CEO characteristic-wise? Right? Because you've got a very unique culture and business model, and I assume that you are not a candidate for the job permanently. Yeah, let me take the first part of that. Hey, John. Good to catch up with you. Yeah, I've been pretty clear. We are going to search for a new CEO, not in a hurry. I'm here, and I'm prepared to stay as long as it takes. This is a unique place. You've known it for a long, long time. We've got a really good search firm. She has been very successful in other placements. She helped out President and CEO over at Sprouts, and she did some work with Gap and Athleta and some others. So we feel very confident in the caliber that we're working with. Our goal is to land a terrific new leader, full stop. If I had to go down my list of things I'm looking for, some public company experience, obviously important, proven track record, someone who's scaled a retail model, which is certainly what we're doing and what is in front of us, some retail, some fresh, and then someone that's really excited about this model. This is not for everyone. It's not conventional retail. It's very unique. It's very differentiated. So we need to find someone that looks at it and says, "I get it, and I see it," and shares that vision. So a lot of that is around culture that you mentioned. A lot of that is about we do things a little bit differently. But those are sort of the top four or five qualities that we're looking for. Hey, this is Lindsay. John, thanks for the question. I'll just chat with you a little about your question on guidance. Yeah, the 1%-3% comp percentage is what we're targeting and what we continue to target. I think what your question was was just the Adjusted EBITDA margins of 6%. If you look at our historical levels, the approximate 6% is really where we've landed on average over the last five years or so. Of course, it's gone up and down quarter- to- quarter a bit. We really feel like that's a good place for us to be and what we continue to shoot for. Definitely still have some systems costs to work through, though, as Eric mentioned, and it's taking a little longer to stabilize, and we want to get it right, and we want to get the tool working as well as possible. It's fully functional and everything. We're just doing a lot of finessing and enhancements Whatnot. but that said, as you think about 2025, that long-term algorithm of the 6% is what we shoot for, but kind of building towards that, if you will, throughout the year. As a reminder, please limit yourselves to one question. The next question is from Mark Carden from UBS. Please go ahead. Good afternoon. Thanks so much for taking the question, and welcome back, Eric. So on the UGO acquisition, how is it going relative to your expectations? How much has it been impacted by some of your recent execution challenges? And then with the leadership changes, are you thinking any differently about timing for moving these stores over to independent operators? Thanks. Yeah. Hey, Mark. Nice to hear your voice. Yeah, UGO is pretty new. It's going right as we thought. We did not have a very aggressive transition schedule. In fact, we did not plan to convert those stores until much later, actually after 2025. Initially, the biggest opportunity we see is to get them into the fold of reporting. Second is to make sure that the products that we have that they don't have, they can have. They have quite a few less items scanning through their stores than we do, so we see some immediate sales opportunities to infuse them with some of the product we have. We have tried a few one or two refreshes of their stores, so coming in with some of the things we've learned from data that help sell product better inside the store from a merchandising standpoint. Very good readback on those initials. So we'll do some of that next year, call it five, six, seven, 10 stores. And then ultimately, conversion to IO and conversion over to GO Brand will come later. Not in a hurry to do it. We want to make sure that we hit some of those other initiatives first, and then we can transition them over. We've done that before. The next question is from Corey Tarlow from Jefferies. Please go ahead. Great. Thanks, and good afternoon. I was wondering about unit growth. How do you think about the complexion of unit growth going forward, whether it's via acquisition or organic growth, and what's the right rate for the business? I believe you've previously targeted 10% in the past, but just curious, Eric, if there's any change in thinking there. And then just on the investments that you've made in the value proposition, and I think that you're planning to continue to make, is there any way to put into context the magnitude of the investments that you're making now versus in the past and what the impact could be? Thank you. Yeah. Hey, Corey. Let me take the second question first. I'd say the value prop, we are making investments. I would not say they are, from my estimation, any different than what we've had to do two, three, four times I can recall and recount. We get slightly off every once in a while, and we're getting back. So we told you how we measure, and let me just walk through those measurements again, the 40% and the 20% basket. So 40% savings over conventional check, 20% savings over discount check. Take a basket of 100 commodities. These are the frequently bought items. They need to be priced at parity versus discount check. The last one that's not quite a check that we're working on is the excitement drivers. Right? Our operators will say, "Yeah, the order guide looks great, but there's not enough excitement drivers," so we need to inflect on that. I would not say that the margin we have to put into that is extreme, but we don't know. We haven't done that work yet, so we want to make sure we have plenty to invest if we need to and make sure that when we get there, we know we're there and we've got it to keep, so second is on unit growth. Yeah, it's a good question. I would say that traditionally, our acquisition ideas have been very opportunistic. Where we find someone that kind of fits into the culture and the geography, we might jump into that. I wouldn't say go look for a whole bunch of that in the future. I would say from a new store perspective, the 10% is not at risk. We have the stores. We have the capacity to do the stores. Think back two, three years ago, post-COVID, a lot of delays. It created havoc with supply chain. All that's behind us. The dealmakers have done, and the construction team has done an amazing job in the last year or so setting up 2025 really well. So I think we mentioned 50 stores or so that are signed ready for 2025. We're actually working on 2026. So no concerns or issues there. And I wouldn't say that we wouldn't do another acquisition, but I wouldn't say we're going to go look for another acquisition. Thanks for the question. The next question is from Oliver Chen from TD Cowen. Please go ahead. Hi, Eric and Lindsay. As you think about the challenges and opportunities ahead, how would you rank them, Eric? What are the key priorities in terms of the bigger challenges that you see? Also, any context on thinking nearer term versus medium term in terms of some of the issues, and interrelated, you have great relationships with independent operators. Just wondering your thoughts on what it will take to continue to foster those as well. Thanks. Yeah. Hey, Oliver. Thanks for the questions. Look, I'd say first on my list and in my mind, and I'd say on the minds of everyone here, is let's make sure that we go deep enough on value and we get that momentum back. A bit like a flywheel, once you start rolling, it's really easy to keep rolling. I think we did ourselves some damage, frankly, in Q1 through early Q3 in pricing for margin versus pricing for value, and we're paying the price of that right now. We are getting it back, and we're feeling good about it. There's a lot of energy, and there's a lot of momentum. I think we've got one of the best offerings for the Thanksgiving meal, and our product offering in an opportunistic world can sometimes be challenging, but we are really well set up for that. So I feel good about it, and we're going to focus on that. And then as we're successful, we're going to start to lay out some of the other initiatives. Relative to IOs, look, these guys have had a tough, tough year. It has been flying a little bit blind, things not working, things coming back online not being fast or quick, redundant efforts and activities in the stores, inefficiencies, frustration. We've heard it all. We were with the operators in Dallas at our annual meeting for four or five days, three or four days in September. And I would say read the mood as very positive. They are a graceful group of people. They give us a lot of room to try things, and sometimes we make mistakes, and this has been one of our biggest. And so they're supportive as long as we communicate with them and as long as we tell them the truth and share with them what the timing is and what the fix is, which is what we're doing. So I'll leave Thursday. We'll go Thursday, Friday, Saturday. We'll see about 70 operators. We'll do it again next Thursday, Friday, Saturday. We'll see another 70 or so. And then Dory and I will take a trip out to the east and see some more operators around Thanksgiving time. So they need to know that we care. They need to know that we're listening. They need to know that we're working hard to address their issues. And they are patient, and they're forgiving. And we're super lucky to have that relationship. But you can tell by the timing, probably my seventh or eighth day back, I'll be out with a bunch of operators taking questions like this and sharing with them kind of what we're doing, so super important to us, and we take that incredibly seriously. The next question is from Joe Feldman from Telsey Advisory Group. Please go ahead. Yeah. Hi, guys. Thanks for taking the question. Eric, wanted to just ask you, when you've talked about execution, and I apologize if I missed it, but what are some of the things that you'd like to execute better, and where are the maybe a project or two that you think could get a little delayed if you could share any color on that initially? Thanks. Yeah. Look, let me just talk about all the things that we're trying to do, make an acquisition, wrestle the project we call SAP, launch private label, run an app and some new marketing tools, manage a workforce that's not always here all the time. Just the challenges of this business when tools are not working for you has been a little bit more difficult than we ever thought and would ever want, so again, early on, we're going to lay out all of the initiatives with the team and decide what stays, what delays, what goes, and I wouldn't say any of the things that I've mentioned are off the list, but my example of UGO, we don't need to go do a whole bunch of work on UGO right now because they're running. They're operating. We get them some product. They're going to be fine. We do a little bit of reinvestment back in the store. They're going to be fine. The next question is from Leah Jordan from Goldman Sachs. Please go ahead. Good afternoon. Thank you for taking my question. So I understand your system visibility isn't fully back to where you want it, but it has improved over the last year. So I'm just curious why your Q4 guide suggests we aren't really getting any gross margin lift from lapping that initial disruption last year. Just curious where that all went. Is it all competitive pressures? And I guess I'm also curious why you aren't getting a benefit from some closeout competitors going away as well. Hey, Leah. This is Lindsay. I can speak to that. So yeah. So just I'll address just a couple of the pieces, comp and margin as well. So we're still facing some issues with the system, as we talked about. Data visibility, you're right. We brought it back in a great way earlier in the year. What Eric mentioned, though, as well is that while we've made a lot of progress and the system is functional and operating, it's taking the teams and the operators a lot longer to do some of the tasks they did before. And frankly, it's just still very inefficient. And so as you think about how nimble we are and how we love to be, we've been really hampered by these tools that we're trying to improve. So we're continuing to do that. So giving you that flavor kind of leads into comp. And so there's a couple of reasons on comp. So even though we saw recent trends, we're facing some difficult comparisons for Q4. We want to be prudent as well. We really hope our guide is conservative. It appears to be conservative, but just given all the reasons we've laid out, we really wanted to make sure that we were laying out the comp that we feel is achievable. And then with gross margin, same thing there as well. So stubbed our toe a bit earlier in the year with trying to get some margin dollars, and we lost some value. And that really just plays into coming out of that into Q3, feeling like we still have a bit of a drag with some of the system inefficiencies. Nothing material in Q3 or Q4, but there's just kind of little bits everywhere that just are a drag on margin. And so what I would say is we're not seeing anything like we saw back in the early days with the adverse material impacts that we've walked you all through from Q3 of last year through Q2 of this year. But we just still have some value to work through for our customers and some margin improvements. So getting back to your question, did we get it all back or not? I think that we're in a much better position than last year, but we're not fully back. So again, thinking about all that and then also layering in the conservatism is really where we're laying out our guidance. And like I said, we hope it's really conservative, but that's where we're at right now. Hey, Leah. I'll jump on the second part of your question. We are getting a pretty good benefit from the 99 and Big announcements. That's been flowing through sort of since last year and through this year. I'd say our op buying is really strong right now, definitely picking up, and both from what we're buying, penetration of what we're shipping to the stores, the increase in margin. So that's all, I would say, in the good column. We need to make sure that the value, and we measure value in lots of different ways. We've just discussed a few with you. We need to make sure that people are really taking notice of those best deals out in the store. So that's what we're heads down on. As a reminder, please limit yourselves to one question. The next question is from Michael Baker from D.A. Davidson. Please go ahead. Okay. Hi. My one question will be on the buying environment, if I could. So relative to the peak in 2023, which I think margin has peaked at about 31.3%, and now you're talking 30.5%, which is your long-term plan. Is it that you're reinvesting more back, or is it that that buying environment post-COVID, when there was so much supply chain disruption, was just so strong that it's unlikely to repeat again? I get that there's always closeouts, and you never run out of products, but it was just probably is it fair to say it was just as good as it's going to get post-COVID because of all that supply chain disruption? Yeah. Hey, Michael. Let me just walk you back a little bit on history and talk a little bit about buying margin. So through, call it, 20-25 years of paying attention here, we've operated within a very narrow band. Some can't believe how narrow, sort of call it 30%-31%, and delivered a 5% comp on average and positive comps for 20 of the last 21 years. That's been delivered while we've introduced massive changes in the business. Those changes are things like MTO or more low-margin fresh product or the acceleration of produce or meat, the introduction of new categories. And I'd say while we've taken lots of intrusion from market competitors. So this model, for those of you who can't quite get your heads around it or appreciate it, it's very, very different. We have the ability to price something this week that we'll sell next week, and that's half of our assortment, so we can pay attention and watch really closely, and so I would never say that we'll never see these margins again. I would say the contrary. We roll between the band of sort of 30 and 31, maybe call it 30 and 31 and a half, and have gotten very, very comfortable being in that band, and that's with anything that's happened to this market. Right now, product is healthy. When you see more and more opportunists coming in, you should think margins are going to be better unless we choose to invest those, which is what we're doing right now to make sure that we've got the customer, so that's a little bit of how it works and how it has worked for a long time. The next question is from Simeon Gutman from Morgan Stanley. Please go ahead. Hi everyone. Hey, Eric. This is definitely beating a dead horse. I wanted to ask again about the systems issues creating a weaker value proposition. So I get you may not have had visibility on the buy, and that could have affected what you were selling prices for on the shelf. The IOs know where relative value, I would think, sits, and certain goods sell at certain prices. So if you think about that logic, the safeguards not being in place to know that, can you talk us through that, how these things weren't caught, and then, frankly, how systems issues led to that value just not being there for a certain period of time? Thanks. Yeah. No, you got it. We did this to ourselves. I'm going to take ownership for that. We price for margin. We did not price for value consistently. Upon reflection and looking back at it, it's pretty easy to call that, right, armchair quarter backs. The however is there were really good reasons why we did that. We'd had a pretty scarring Q1. We thought margin was well within our control. And at the same time, people were taking prices down. We took prices up. Okay? So we are where we are. You're right about the operators. They have the ability to price things up and down, but they allow us to price, call it 99% of the time. We ask operators to be right on micro-market adjustments that they need on a few items. We don't ask them to be us and try and price. We have a much better ability to see the broader lens of competitiveness and to set the price right, and you got to keep in mind we share gross profit margins, so operators are focused on margin sometimes to a fault like we are, so that's a bit of the explanation. Did systems cause it? It's really the visibility that occurred with the lack of proper systems that caused it, and then our reaction, easy again to weigh in on now, I think was probably improper. The next question is from Jacob Aiken-Phillips from Melius Research. Please go ahead. Hi. Thanks for the question. So I'm wondering, you said that part of it is the system transition was not being able to have the visibility or inventory. And then part of it was some competitive pressures when you took pricing. So can you help us contextualize what that means for comping over that in Q4 and in 2025? Because I don't know. I would have expected a better Q4 given you're lapping like 200 basis points from last year. And then separately, you don't seem to be planning to reduce unit growth at all. So how do we think about new store productivity in the coming years? Yeah. Hey, Jacob. I can take the first part of the question. So yeah, definitely a tough comp guide. I get it. The Q4, Q2, that's tough. And again, after seeing the positive trends in September and October, but if you look at a two-year basis, it's showing a slight slowdown. And again, we're progressing through the Q4 where we still had some difficult comparison last year, even given the systems impact. So again, we really wanted to be prudent and a little more cautious in our outlook for the full year in the Q4 in comps. And that's why we adjusted our guidance down. And everything that Eric's talked about too as well. We really are trying to rebalance our value proposition and get that back to the customers. We look at it all together, the whole package, and it's comp and it's margin and hitting all of those out of the ballpark, so to speak, where we can. But with comp, it's really being prudent. There's a lot going on right now. We've got holidays, and we've got a few things going on. And frankly, we just really wanted to make sure that we were reading the competitive pressures right for comp and the guide. Then for 2025, again, not commenting formally on guidance, but just reiterating our long-term algorithm definitely stands. One to three comp is what we think is a very strong performance for this business, along with GM at 30.5% and EBITDA at 6%, as I mentioned. So again, that's really what we're trying to orient folks to for 2025, as Eric said. We really don't want to be talking about these systems next year. We hope we're not. And so we really just want to make sure that everyone's oriented to those long-term algos as we head into 2025. And then Eric. Hey, Jacob. Yeah, I think you asked about new store growth. I don't see any problem with the ability to open the 50-plus stores next year. We've got leases signed. Team's done a really nice job of setting those up. So I'd say that number feels good. As a reminder, please limit yourselves to one question. The next question is from Jeremy Hamblin from Craig-Hallum. Please go ahead. Great. And Eric, welcome back. I wanted to just ask about some of the systems costs that are involved here that you noted. You noted some internal as well as external costs, presumably some consultants. But can you quantify what the magnitude of that is on a quarterly run rate? And then what portion of that is likely to be ongoing as we move through these issues in 2025 versus more temporary costs here over the next quarter or two? Yeah. Hey, Jeremy, I don't think we're going to quantify that. It is going to be somewhat ongoing in Q1. Maybe Lindsay, you can. We're not going to quantify all of that. No. Yeah, Jerry, we haven't quantified that, but let me just give you a little context around that because it sounds general, just kind of systems costs. And so as we think about everywhere where we're spending some higher levels of SG&A than we had previously forecasted, a lot that goes into maintaining and improving systems infrastructure. So systems infrastructure, first of all, super sophisticated system with SAP and a lot of other ancillary systems we put into place as well when we went live. Just the infrastructure that we need, the cloud, the GCP, Whatnot, all higher run rate than what we expected and grew more than we thought. Second, resources. You're totally right. So during this transition period where we're trying to continue to further stabilize the system and do enhancements, you've got internal resources, you've got external resources, you have some overlap as you're transitioning those resources internally. We've made some great hires internally with SAP knowledge, which is fantastic. But then you have the overlap where you're rolling consultants off. And we really want to make sure we get this right and we remediate things correctly. So resources is a large part of this as well. And again, definitely a transition time and temporary. And so Jeremy, as you're thinking of 2025, what I mentioned is where we want to see is EBITDA of around 6% in 2025, but really building to that for the full year as we go through the year just because we only have seven weeks left. We really are going to be working on this as we have been, as hard as we can, but we expect some of these transitory costs to continue into 2025. We have time for one more question. The next question is from Bill Kirk from Roth MKM. Please go ahead. Hi. Thank you. Thank you Thank you for sneaking me in. So in the industry, the availability of e-commerce options keeps increasing, whether it's broader assortment or wider delivery radius or even maybe more manageable fees. So I guess the question is, what are your IOs seeing in terms of new competition that might not have existed before that they now have to go up against as the availability of e-commerce options has increased? Yeah. Hey, Bill. I would say not a lot at the value end. All of those delivery options come with a cost, which is a higher price. So for now, people are reverting to value. It's super convenient to order things and have them delivered, but we're getting a lot of engagement from customers on the prices. And I'd say the treasure hunt in store is still really strong. It's well worth the trip. We hear that in feedback and surveys all the time. People are finding that that treasure hunt's a little bit more difficult online. We don't mean to cast any sort of shade at those that are perpetuating that model, but for us, it's a minor part of what we do. And the major part of what we do is the treasure hunt. And look, we're continuing. We've got all of our platforms up, and we're continuing to explore e-com, but it's not a major part of our strategy today. This concludes the Q&A session. I would like to turn the floor back over to Eric Lindberg for closing comments. Yeah. Thanks, you guys. It's good to be back. I'm excited to be back with the people, the operators, and the team. Really bullish on the business, and so appreciate you all giving us some time and having a lot of interest in our business. So thanks for the time today. We'll talk to you in a few minutes. Look forward to it. Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.