Michael L. Henry
Janet, I’ll take that one. We have not seen any significant improvement in those regions and as a matter of fact, we’ve seen significant deterioration in those regions. October of last year was the first time that we saw California, the Southwest really decline and it was in the negative high-single-digit range. As we went through the third quarter, those regions dropped off to minus 20s, minus 25s, something very, very significant and then all of a sudden, the Pacific Northwest and the great plains, which had been up a bit, down a bit earlier in the year, nothing dramatic, it was never in the top, never in the bottom, suddenly had dropped to minus double-digits and then minus 18 in October, so we have certainly seen further deterioration in some of these markets that we have been talking about all year and we are not counting on anything changing significantly going forward.
Janet Kloppenburg - JJK Research
Okay, but if you are looking for comps to be down high-single-digits in December and January which clearly that’s a new flat, you must be thinking that some parts of the country could be, could turn flat or even positive in that period. Is that a fair statement?
Michael L. Henry
Sure. We’ve seen consistent strength through the Midwest and Texas and the Northeast and the Mid-Atlantic. You know, there have been a variety of areas that have been consistently strong for us and we are continuing to see that, even in the results that we’ve communicated here about the first couple of weeks of November.
Janet Kloppenburg - JJK Research
Okay, and I was wondering, as we look into ’09, a couple of questions -- first of all, do you anticipate that the footwear and accessory categories will stabilize? That is, that we will stop seeing the deep declines that we’ve seen in those businesses? And secondly, what in terms of pricing are you thinking at all about skewing your prices to a larger amount of product to the value end?
Sally Frame Kasaks
Janet, our footwear business is now down to about 4% of our total business and by spring, it will be down to 3%, so this is where it was much higher last year so in effect, it’s become a non-issue in terms of our overall performance. It was a drag on comp as we were liquidating but no longer.
Janet Kloppenburg - JJK Research
And accessories?
Sally Frame Kasaks
Accessories we see opportunity for upside there. Our teams are working on it now. We probably under-played scarves, perhaps some jewelry as well but we are more prepared I believe going into spring and we are continuing to re-look at that because there are some trends that we can get behind.
Janet Kloppenburg - JJK Research
Okay, and on the pricing, Sally, do you think that you can move to greater value or do you need to?
Sally Frame Kasaks
We have seen our customers respond to some of our key opening price points this year. We’ve seen that, we’ve seen some good reaction to multiple pricing, so we would continue on that. I think the -- I think probably the bigger change is the amount of debts we’ve put behind key items and key, sort of more basic styles and we are looking to become a little bit lighter on some of the quantities we’ve placed behind product. So our pricing cadence isn''t going to change much for spring. I mean, we had some very good pricing -- it’s probably more the depth we are putting behind the product rather than just the price point.
Janet Kloppenburg - JJK Research
I got it. Good, and then Mike, in terms of the sale of the Anaheim distribution center, are these just technicalities now that are holding up the sale or are there some bigger issues looking? |