Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from the line of Debra Weinswig - Citigroup
Debra Weinswig - Citigroup
Can you talk a little bit more in depth about your work with Alex Partners and how should we think about the improvements that we’ve seen with regards to SG&A performance in the third and fourth quarter of this year, what we expect to see in the fourth quarter and how much momentum do you have going into 2009?
Stephen Sadove
I feel real good about the work that we’re doing, not only with Alex, Alex is working with us on a part of the cost base, primarily in the purchasing arena. But we’re looking at every line item within the P&L so its having to do within the stores. How many people do we need to have within the stores to support the sales base.
Obviously at a lower sales base you don’t need the same number of people that we’ve had before. We’re looking at the organizational structure within the headquarters operations and looking at what do we need to support the base.
We’re looking at whether its travel expenses to any number of the purchasing items and we think that there is a substantial number in terms of savings that we can see in 2009. The 2008 results in terms of lower SG&A in the third and fourth quarters, part of it is driven by the commission base but part of its also driven by real savings that we’re seeing in terms of expense reductions.
I don’t want to give specific numbers as it relates to 2009 in terms of what the year-on-year trend will be. There clearly are some inflationary costs that are pushing you on the other side of it, but I would expect that we’re going to see some reductions as we go into 2009.
Debra Weinswig - Citigroup
I think there’s a credit card promotion that you’re running right now along with HSBC, can you go into some detail on that and who’s liability etc. with regards to that promotion?
Stephen Sadove
Yes, the program we’re calling it a major purchase account promotion where with a minimum $2,000 purchase in a single day across the store an individual can get no interest, no payments for a year on their purchases. We’ve seen a very good response on the part of the consumer to it. We had done it in the jewelry category a year ago, saw a good response, and we are doing it across the board.
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