Question-and-Answer Session
Operator
(Operator Instructions) Our first question today comes from Bob Drbul with Barclays Capital.
Bob Drbul - Barclays Capital
Good morning. I guess the first question that I have is when you talk about the food deflation that is going on, can you just help us understand how you are managing profit dollars? I think you did a good job explaining the comp dollars but I was wondering if you could just help us understand exactly how those comp dollars for those items that have the deflation that’s increasing within the mix?
Laura Sen
Well, I think that the governing principle that will hold on all of our pricing is being priced at strong value for our members and at a competitive price with -- [inaudible] competitors and where we don’t have items that compete against grocery or a super center, we want to make sure that we are offering a very strong value in all cases, so I guess in short there are cases, and we’ve seen it in meat, we’ve seen it in gasoline as well, where when prices -- when costs of goods drop, sometimes competition chooses to hold retail a little higher than they might otherwise do it and that benefits us and we will follow rather than lead down. So that’s a help to gross margins but in many cases, the commodities where we have seen deflation are extremely competitive, like milk and eggs, and those prices drop very rapidly as costs drop and that doesn’t really offer us a lot of advantage, so -- the dynamic is very fluid and it depends on the category, and I think that a lot of times we as retailers, whether it’s for the category of meat or other categories, look at what is offering the strongest value and if there’s some margin opportunity, we like to take it but when all is said and done, we have to be very competitive and make sure that we are holding to our promise of great value when we sell a membership.
Bob Drbul - Barclays Capital
Great, thanks. And then the second question that I have is can you elaborate a little bit more on the trend in August and really what you have seen after the last few months, especially just July into August?
Laura Sen
Well, I mean, what Frank said was what we have seen, is we have had some incredibly tough weather in most of our geography and when it got to be summer as we know it, trends go better. And that’s really all we can say for now.
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