Group 1 - The company faced challenges with elevated inventory levels in the first half of the year but has seen improvements in inventory balance as the year progressed [3][4] - Units per store increased by 6.5% year over year in Q1 but dropped to 4.6% YoY in Q2, with a slight decline of 0.3% compared to last year as of November 1 [3] - The company has a positive outlook for inventory management during the holiday season and chose to allocate capital for inventory management rather than share repurchases [4] Group 2 - Price increases are anticipated, varying by product category, with some categories showing inelastic demand where price hikes have not met resistance [5] - The company has reset its inventory and distribution center operations to run more efficiently in the upcoming year, assuming no significant changes to the tariff structure [6] - The company has no regrets about frontloading inventory in the first two quarters, allowing it to price items at last year's levels before new tariffs were implemented [8]