Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Jeff Blaeser - Morgan Joseph & Co.
Jeff Blaeser - Morgan Joseph & Co.
On the operating cost side, how sustainable do you think these current levels are and what impact do you see from this expansion as well as were any of the cuts that you previously announced workforce reduction, marketing, short term in nature that could potentially escalate down the line?
Mike Odell
The biggest parts of the cuts would be the marketing and the payroll. And I would really term it, actually, instead of cuts I would call it a repositioning. We have shifted our from being very extensive on the pre-print to drive the accessory business and the discretionary spending and shifted that basically into the service business and recently have added on the TV and radio to support the retail, as well.
So we're comfortable with the shift that we've made in the marketing. I wouldn't say that we cut the print and it's cause of decrease in sales as much as we've shifted the emphasis in the direction of the company, and recognizing that what was being driven by the pre-print, you know, it's important but it's not the key to our future. The key to our future is the service and the hard part side of the business.
And the payroll side, a lot of that, the products that we were selling, there is incremental costs to that as well. I mean, it really was shifting our model and that's why we are getting out of this, de-emphasizing this product because yes there were sales and yes there were margins, but it had a lot of other expenses associated with it.
Ray Arthur
And you will probably see that as kind of a run rate. It's not as if those savings are going to disappear in Q3 and Q4. And there are—Mike certainly indicated the biggest are in marketing and payroll, but there are significant cuts in other areas that are not quite as large but that will be sustained. So the savings that you see in the quarter, there will be probably some more savings in Q3 and Q4.
Mike Odell
And in terms of the service folks, most of the costs associated with those, and by the way, we're calling them service and tire centers in our comments because that would be the customer views, so I have shifted to calling them service and tire centers. And most of the costs for those are really inside the stores, and therefore part of the economics I was sharing. We have a little bit of overhead to add relative to kind of real estate and development but those are fairly modest expenses that are required to support them at this point in time.
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