The reality is that none of us know for sure and we are all...

The reality is that none of us know for sure and we are all guessing.

I do not believe that employee costs will reduce in line with reducing sales. There may be some reduction but it won't offset the sales slump combined with minimum wage rise as explained below:

• My logic is that outside of store closures, it's unlikely that a retailer can reduce their labour costs by 11.3% year on year by simply removing excess staff. I imagine there are a certain number of employees per store that are required to simply keep the doors open. Even during the 'boom times', whenever i went past a DSK store it never appeared to be so busy outside of holiday / gifting periods. Therefore, the sales staff in store are likely similar but just selling less product. I acknowledge your point that there would be a reduction in surge staff over Christmas and similar periods - however this is only a few weeks within a full 12 month period and I can't see that equating to a 11.3% reduction in staffing costs to match declining sales.

• The above is before we consider there has been a substantial 5.75% minimum wage rise that commenced from the 1st July 2023 (this financial year). Therefore, to keep employee costs per sales $ consistent - DSK would need to grow LFL sales by 5.75% to maintain the status quo. If you consider DSK is looking at a LFL sales decline of 11% - then that means number of employees would need to reduce by approximately 16.75% to offset declining sales + increasing minimum wage. Seems more than a little unlikely IMO.

• Let's consider the context - we have close to record low unemployment and the view is that DSK is in a temporary sales dip with sales to roar back in 2025. If you were the management, would you lay off a substantial portion of your work-force now and take the risk (and cost) associated with re-hiring in a very tight employment market. Or would you retain more staff and accept they are temporarily less productive. IMO if DSK management believe the narrative that sales will recover in FY25 then it's even more likely that the employee cost per sales $ will jump substantially higher.

• We can use history as a guide, we don't have to look back too far. FY23 saw LFL sales decline by 13.2% - employee expenses increased from $33,290,000 to $37,830,000 - an increase of 13.63%. The employee cost per sales $ in 2022 was 24.05% and increased to 27.48% in 2023. What reason do you have to believe that this year would be different?