Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from the line of Lauren Levitan - Cowen and Co.
Lauren Levitan - Cowen and Co.
I was wondering in response to your comment, Kathleen, about the promotional activity that you particularly saw in some of those important categories, if you are making any adjustments or reorientation to the composition of the inventory for the next several seasons and if that has any implications for gross margin, because Mike called out that mix was a factor.
And then, second, I was hoping, you commented on SG&A per store, you said it was down 4.6% in the first half of the year. Could you give us some sense of whether or not you think that that’s a run rate that’s reasonable, going forward, or if you think that there are additional opportunities or less opportunities in the balance of the year? Thanks very much.
Kathleen Mason
As far as the composition of inventory is concerned, we have made adjustments in our inventory to trend. And we feel at this point that the mix going forward is appropriate, our on order is appropriate. We certainly have some inventory to work through.
And as far as the gross margin is concerned and the pressure on gross profit, I think the difficulty in this environment is there is no pricing power in things that customers don’t want. So we’re being very careful about what we buy, how we negotiate it, and what the comparative pricing is.
Michael Marchetti
With respect to the expense question on the run rate for expenses, the 4.6% is a reasonable run rate that we could expect to be able to sustain.
Operator
Your next question comes from the line of Jeff Sonnek - Friedman, Billings, Ramsey & Co..
Jeff Sonnek - Friedman, Billings, Ramsey & Co.
Two questions, Kathleen, just along the lines of your comments on inventory. In the press release, you said, ?we were aggressively responding to the pressures of the home furnishings’ macro environment.? Can you maybe just provide us a little bit more color about what you’re really thinking of when you say ?aggressively responding??
Kathleen Mason
We’re working through our inventories in terms of making sure that we are as correctly priced as we can be in this environment. It’s difficult, I think, to work against continual loss leaders in the environment. So we are really scaring away from what we believe will be continually pressured categories and moving aggressively into some categories that we have had good results with.
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