$10 EPS Target Update
Q: Is the $10 EPS target still achievable?
A: Management reaffirmed belief in the $10 EPS target, but noted that the macro environment, including high shrink numbers and mix shifts, has made it difficult to pinpoint the exact timing. They are now focusing on achieving $7 EPS in 2024 as a step toward the $10 goal.

Margin Guidance by Banner
Q: Can you detail the margin outlook for each banner?
A: Dollar Tree expects a gross margin of 36% to 36.5%, influenced by the multi-price rollout, which pressures margin rate but drives unit growth, and a $0.80 to $0.90 freight benefit, with 60% realized in the first half. Family Dollar's margin is impacted by shrink and mix but is offset by private label growth and opportunities in OTC and HBA categories.

Store Closures and Sales Recapture
Q: Will closing 600 stores impact revenue, and can sales be recaptured?
A: The company is optimistic about recapturing sales, as many closing stores are near existing locations, offering opportunities to regain cannibalized sales. The closures are expected to be cash neutral to accretive, with potential sales transferring to nearby stores.

Comp Outlook and Traffic Progression
Q: What is the comp outlook for 2024?
A: Management anticipates a strong year, especially for Dollar Tree, with positive comps driven by initiatives and a robust Q4. Family Dollar faces challenges due to mix shifts and pressure on low-income consumers from reduced SNAP benefits but expects improvement toward year's end.

Multi-Price Point Penetration Goal
Q: When will multi-price point penetration reach 10%?
A: Multi-price point penetration was 8.8% in Q4. Management is aiming for the 10% milestone and plans to stagger the rollout to maximize its impact over time, viewing it as a "gift that keeps on giving."

Accelerated Dollar Tree Expansion
Q: Will you accelerate Dollar Tree unit growth?
A: Yes, the company is shifting focus to opening more Dollar Trees than before, driven by success with coolers and multi-price points, enhancing the store model's viability. Optimizing the portfolio allows better focus on profitable locations.

SNAP Benefits Reduction Impact
Q: How significant is the SNAP headwind for Family Dollar?
A: The reduction in SNAP benefits poses an estimated 5% headwind for Family Dollar, based on customer penetration and its year-over-year impact.

Supply Chain Improvements
Q: How are supply chain changes affecting inventory?
A: Unload times have been reduced to approximately 1 hour, improving store standards and in-stock positions. Better coordination with suppliers has enhanced inventory levels at distribution centers and stores, leading to improved sell-through.

Leveraging Lower Input Costs
Q: How are lower input costs adding value at the $1.25 price point?
A: Fixed price points enable Dollar Tree to re-engineer products when input costs decrease, delivering greater value to customers while maintaining the $1.25 price point.

Average Ticket Trends
Q: Why is the average ticket down despite higher price points?
A: Average ticket is lower due to increased shopping frequency with smaller baskets. However, baskets including multi-price items can be 2x the average, indicating strong adoption of higher-priced items.

Family Dollar Consumables Performance
Q: How is Family Dollar performing in consumables amid competition?
A: The consumables mix is the best it's been, with a focus on private brands offering national brand equivalents. Pricing remains stable, and their competitive position is strong.

Handling Inventory from Closures
Q: What happens to inventory from closing stores?
A: The company will offer discounts to sell through inventory, with expected impacts already included in guidance. Inventory impairments have been accounted for to reflect the sales.