David B. Dillon
Actually, it’s those trends that give me confidence in our sales going forward because it tells us that there’s opportunity and sales available out there that we could still be getting more. So actually I feel better about the fact that that data is there and the reason I am confident about that is I believe based on our own research that customers prefer to shop with us than in those other types of stores that you’ve described. And because they prefer to shop with us, we think that as we give them more and more reason to do so, even in this economy they will continue to do so and they will do it in growing numbers, and when the economy improves, we think that that improves our prospects even more.
So I’m pretty bullish from the perspective of what you were describing.
W. Rodney McMullen
And as you’ll recall in the first -- year-end earnings call, we talked about it, that our market share last year grew by over 60 basis points and if you look at over the last four years, it’s 225 basis points for the sum of those years together.
Neil Currie – UBS
Sure. Just a final one. I noticed that you called out lower warehousing, cost of warehousing distribution and that you seem to call out as a part from the usual cost being lower, in terms of some of the investments you’ve made in IT in recent years with regard to warehousing and distribution, are you starting to see that come through in terms of lower cost or is there something else that’s causing lower warehousing costs?
W. Rodney McMullen
It’s really a combination of lower costs from the investment and driving that plus process change in our existing facilities. It’s really both together.
Neil Currie – UBS
Okay. Thanks very much.
David B. Dillon
Thank you, Neil. I think we have time for one more question.
Operator
Thank you, gentlemen. Your final question will come from the line of Meredith Adler representing Barclays Capital. Please proceed.
Meredith Adler - Barclays Capital
Thanks for taking my question. Good numbers, congratulations. I would like to start by talking a little bit about a comment you made about if you see some inflation again, then something that was a tailwind in the first quarter might go away and you weren’t talking about fuel. I think you were talking about food inflation. Is it fair to say that the deflation you saw in some categories was actually beneficial to gross profit dollars? I think I’ve asked this question before but I’ll ask it again.
David B. Dillon
Well, it really depends on the items. Let’s just take milk as an example. We do expect the cost of milk to go up a little bit in the end of the year from where it is now and I do not think it’s correct to say that that helped our gross margin dollars but we sold a lot more milk. But the dollar sales would have suffered a bit because it was down actually quite a little bit.
So if we end up with a little bit of inflation in milk going towards the end of the year, actually we’ll see the retails go up and I would actually anticipate maybe that makes a little bit more gross margin in that situation but that’s always a hard one to read. It depends completely on the competitive market.
|
