A.C. Gallo
So that -- that’s it. We got very, we got marginal leverage, marginal leverage this time even in the ident stores because we are recycling over such deep leverage last year, but I think John is right. We will have to go forward and see how we deal with that given these new disciplines.
Walter Robb
We hope to see some. But we don’t want you to model it in because it is going to be a hard fight to create it over the next few years.
Glenda J. Chamberlain
The disciplines that we put in place last year in areas of purchasing, inventory management, spending on new stores, overall CapEx spending and overall spending still exists and are still remain a focus for us. 2.9% G&A that we are guiding to for fiscal year 2010 is a great number for us relative to most of our history. And we do expect to produce continuing leverage in ident stores, most likely although not significant but for our total company basis it is very difficult to.
John P. Mackey
And what you will see over time is the expense discipline we have in terms of new stores will be probably what affects overtime getting leverage in direct store expenses. We’re going to be opening smaller stores and we’re going to be spending less money to open them. That’s going result in less depreciation and higher profitability and better cash flow. So as we open more and more relatively smaller stores that is going to have a long term positive impact. But I don’t expect you should see that much occur in the next year or two. It will take time for that narrative to play out.
Edward Kelly - Credit Suisse
Just a follow up. Is that assuming the same type of comp growth you are talking about now?
John P. Mackey
We don’t know what’s going to happen with comps. I mean, we are in such a discontinuous world right now. We had high single digit, low double digit comp growth for like 30 years, then we went into this recession. What we don’t know is we don’t know what’s going to happen with the economy and we don’t know whether or not we are returning to our historical pattern or whether this is -- we just don’t know what’s going to happen with comps. We really can’t predict it.
We are as interested to find out as you, what’s going to happen. So a year from now, we will have a better indication of what our comp trends are going to be. We are certainly excited right now after being wondering around lost in the wilderness for two years to see our comps moving in the right direction. So we are very excited about that and we feel like we are building momentum again, but we are not prepared to make any predictions about where comps are going to level out at. We hope it will level out for many quarters, but we are not making my predictions of that.
Edward Kelly - Credit Suisse
Fair enough. Thank you.
Operator
We’ll take our next question from Karen Short with BMO Capital. Please go ahead
Karen Short - BMO Capital Markets
Hey, congratulations on a great quarter.
Glenda J. Chamberlain |
