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Tag: Costco

  • Costco Leverages JD.com for Bold China Expansion, Boosts Online Presence Beyond Warehouses

    Costco Leverages JD.com for Bold China Expansion, Boosts Online Presence Beyond Warehouses

    Costco, the multi-national corporation recognized for its warehouse club model, has embarked on an exciting new venture in China. Costco has launched an online flagship store on JD, one of China’s largest online retailers, thereby marking a significant point in its expansion in the Chinese market. This strategic move aims to augment Costco’s digital presence beyond the parameters of its existing network of physical warehouses.

    A Growing Online Presence

    The collaboration with JD makes it possible for consumers across China to access approximately 700 products. The diverse range of offerings includes grocery items, household essentials, health supplements, beauty products, and Costco’s private-label range, Kirkland Signature. Notably, the online store allows Costco to penetrate cities where it currently does not have a physical presence.

    The launching of the flagship store on JD represents a crucial milestone for Costco in China. It signifies a significant shift in strategy that emphasizes the importance of online retail in the current market scenario. Costco China says, “By leveraging JD’s well-established online platform and extensive logistics network, we are able to overcome regional limitations and extend our reach into broader markets. This allows us to effectively deliver Costco’s signature merchandise and service value to consumers across the country.”

    Impressive Initial Response and Expansion Plans

    The online store first underwent a trial phase in late May. It was met with an overwhelmingly positive response, attracting over 30 million visits and almost 200,000 followers in just the first month. This underscores strong consumer interest and sets the stage for an optimistic official launch.

    Costco’s strategic move is part of its cautious yet continuous expansion in Mainland China. Since the opening of its first warehouse in Shanghai in 2019, Costco has added a few more stores in major cities. However, the emphasis has increasingly been on using digital channels to further expand its market reach.

    Questions & Answers

    What does Costco’s partnership with JD aim to achieve?
    Through the partnership with JD, Costco aims to overcome regional limitations and expand its reach into broader markets in China. It also allows Costco to deliver its signature merchandise and service value to consumers nationwide.

    What range of products will be available in Costco’s online flagship store on JD?
    The online store will offer around 700 products, including grocery items, household essentials, health supplements, beauty products, and Costco’s private-label range, Kirkland Signature.

    How has the initial response been to the trial phase of Costco’s online store on JD?
    The initial response has been overwhelmingly positive, with the store attracting over 30 million visits and nearly 200,000 followers in the first month.

  • Costco Australia Outperforms: Profits Soar by 40% Taking Top Spot Over Aldi

    Costco Australia Outperforms: Profits Soar by 40% Taking Top Spot Over Aldi

    Costco, the United States-based wholesale giant, continues to make waves in the Australian market. The company has seen a significant year-on-year profit increase of 39.4%.

    The financial report for the fiscal year ending on August 31, 2025, reveals an impressive annual income of $10.8 billion for the company. With a global footprint of 923 outlets, Costco currently provides employment to nearly 13,000 individuals.

    Australian Operations Showing Strength

    The Australian segment of Costco, which also oversees operations in Taiwan, has reported a profit increase from $279 million in 2024 to $389.1 million. This demonstrates the continuing growth and profitability of the company in the region.

    Costco has established 15 warehouses across Australia since launching its first location in Docklands, Melbourne, in 2009. The company’s expansion plans include the opening of another site in Victoria and a new location in Western Australia by 2027.

    Outperforming Competition

    Costco’s after-tax profits now surpass those of Aldi, which is currently the third-largest supermarket in terms of market share in Australia. This achievement indicates Costco’s aggressive growth strategy and successful performance in the competitive Australian market.

    Questions & Answers

    What is the recent growth rate of Costco in the Australian market?
    Costco has seen a significant year-on-year profit increase of 39.4% in the Australian market.

    How many Costco warehouses are there in Australia?
    As of now, Costco has established 15 warehouses across Australia.

    How does Costco’s after-tax profit compare with that of Aldi in Australia?
    Costco’s after-tax profits now surpass those of Aldi, which is the third-largest supermarket in the country in terms of market share. This indicates Costco’s strong performance in the competitive Australian market.

  • Costco and DoorDash to deliver groceries to the doors of Aucklanders

    Costco and DoorDash to deliver groceries to the doors of Aucklanders

    Costco has teamed up with DoorDash to deliver its range of groceries and household essentials to homes in Auckland at bulk-saving rates.

    The partnership will enable Costco members and non-members to get everything from toilet paper to fresh fruits and vegetables or premium poultry and meat delivered to their homes.

    “We’re always looking for ways to make everyday shopping easier, and our partnership with Costco means Aucklanders can now get incredible value and quality delivered straight to their doorstep,” said DoorDash New Zealand GM Bradley Thomas.

    To launch the new partnership, New Zealand customers will receive NZ$20 off their first Costco order when they spend $150 or more.

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  • Costco is pressuring Mainland China suppliers to cut prices as tariffs loom

    Costco is pressuring Mainland China suppliers to cut prices as tariffs loom

    The Financial Times reported on Tuesday, citing two suppliers, that Costco Wholesale is pressuring mainland China suppliers to cut prices in response to US tariffs.

    This follows Beijing officials meeting with Walmart earlier this month to discuss media reports that the US retailer asked Chinese suppliers to slash prices to offset tariff impacts.

    Costco’s chief executive officer, Ron Vachris, said during their quarterly earnings call earlier this month that the company would consider modifying its international supply chain if tariffs result in significant price increases.

    According to Vachris, about one-third of Costco’s US sales come from products imported from other countries, with less than half of that originating from China, Mexico, and Canada.

    Costco did not immediately respond to a Reuters request for comment.

  • Costco fined for mislabelling seafood origin

    Costco fined for mislabelling seafood origin

    Costco Wholesale Australia Pty Ltd has paid penalties totalling $33,000 after the ACCC issued it with two infringement notices for alleged false or misleading labelling of the country and place of origin on lobster products and failing to comply with the Country of Origin Food Labelling Information Standard.

    In early January 2023, Costco sold two packages of lobsters from its Casuarina warehouse in Western Australia which were labelled ‘Kirkland Signature PREVIOUSLY FROZEN WHOLE COOKED WA LOBSTER’ and ‘Australian Lobster’. Other packages were also displayed for sale with the allegedly misleading labels. In fact, the lobsters were imported from Canada.

    The ACCC also alleges that Costco did not comply with the specific Country of Origin Food Labelling Information Standard because it used the Australian-made kangaroo logo as well as a full bar chart indicating that the lobsters were exclusively Australian when they were not.

    “Selling goods with an incorrect country or place of origin label is a breach of Australian Consumer Law,” ACCC Deputy Chair Mick Keogh said.

    “Many shoppers pay a premium to purchase Australian seafood rather than imported products, which makes the accuracy of the labelling a crucial part of enabling consumers to make an informed choice.”

    “While a small number of consumers were impacted in this instance, this conduct involved a large and sophisticated business,” Mr Keogh said.

    “This action by the ACCC is a reminder to all businesses, large or small, of the importance of ensuring that country of origin labelling is accurate and complies with the Country of Origin Food Labelling Information Standard.”

    Costco is one of the world’s largest retailers and operates warehouse outlets in 13 countries. Costco operates 15 warehouses in Australia.

    The Country of Origin Food Labelling Information Standard 2016 applies to most food available for retail sale in Australia, including food that is imported into Australia for retail sale.

    The standard requires that if a product is grown, produced or made in Australia, the label must contain a ‘standard mark’ label which includes the kangaroo in a triangle logo which indicates the product is of Australian origin; a bar chart indicating the percentage of Australian ingredients in the food; and explanatory text which states whether the product was grown, produced or made in Australia.

    In addition to the Country of Origin Food Labelling Information Standard, section 29 of the Australian Consumer Law also prohibits businesses from making false or misleading representations about the place of origin of the goods they supply to consumers.

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  • Costco sets Westgate opening date

    Costco sets Westgate opening date

    American wholesale retailer Costco will open its $100 million Westgate store on September 28, ending months of speculation about the date of its debut in New Zealand.

    The retailer initially planned to open last month, however it was delayed due to bad weather and Covid-related restrictions.

    The new store spans 1.4ha and will feature a petrol station, tyre centre, optometrist and food court as well as a wide range of food and grocery products.

    The retailer will hire about 350 workers and has brought in 30 to 40 staff from Australia to train locals.

    In April, the retailer opened its first petrol station in Auckland selling fuel at around 20 cents a litre, cheaper than nearby service locations.

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  • Costco to invest $150m in three new Victoria stores

    Costco to invest $150m in three new Victoria stores

    Costco plans to open three new stores in Melbourne and Geelong within the next two years, investing up to $150 million.

    CEO Patrick Noone told The Australian in an interview that potential sites were identified near Melbourne’s CBD, and at Officer and Geelong. Each store will be allocated $50 million, with the projects now depending on zoning and council approvals.

    “We are growing quite nicely, and Melbourne is a big city. For us, business isn’t slowing down in Melbourne,” said Noone.

    “Melbourne is a growth area and we’d like build there as soon as we get the approvals.”

    During the Covid lockdowns, Costco remained a ‘destination shop’ for Melbournians as members travelled long distances to shop at the store, buying in bulk when regulations allowed.

    Costco currently boasts 200,000 members and sells a mix of goods from fresh food, groceries, meat, consumer electronics, clothing, diamonds and even coffins.

    According to The Australian, Costco Australia’s sales in the year to August rose from $2.6 billion in 2020 to $2.8 billion last year. Strong online growth helped the company double its profit to $46.39 million.

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  • Costco China plans more store openings

    Costco China plans more store openings

    Within days of opening its first warehouse store, Costco China is already talking about its plans to expand the new network.

    As happens in many new market Costco enters, the new Shanghai store grew thousands of people, some of who queued for hours to shop, and then check out, while others spent a similar time in their cars circling the suburb seeking somewhere to park. In the afternoon, the store was closed due to crowding.

    Costco CFO Richard Galanti confirmed with analysts a second store is already in advanced planning and he hopes construction will start as soon as possible.

    The first store opened on August 27 in Shanghai’s Minghang district. It followed a four-year program by Costco to build brand awareness among local consumers through a presence on Alibaba’s Tmall Global. The company has a target of signing up at least 100,000 members to make the venture viable.

    While Costco expected to draw large crowds to the opening, the sheer numbers exceeded even the company’s most optimistic projections. A record number of customer membership registrations were taken for an opening day, however Galanti did not release the actual number.

    Costco China is looking to establish a beachhead in Shanghai before expanding into other tier-one cities.

    Trade tensions between China and the US appear not to be affecting the store’s early success, with Costco switching sourcing of some products from the US to Australian suppliers.

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  • Costco China opens first store in Shanghai

    Costco China opens first store in Shanghai

    US warehouse retailer Costco opened its first store in China today, against a background of an escalating trade war between the US and China and at a time the local economy is showing signs of slowing.

    The giant store will open in a suburb of Shanghai boasting a catchment of 2 million consumers and follows a four-year program by Costco to build brand awareness among local consumers through a presence on Alibaba’s Tmall Global.

    The company has a target of signing up at least 100,000 members to make the venture viable.

    Costco’s business model relies largely on the sale of memberships giving consumers the right to shop there, with tight margins on products and large pack sizes giving the brand a cost advantage over traditional supermarkets.

    Richard Zhang, Costco’s senior vice president for Asia, said the membership model was not foreign to locals.

    “Chinese consumers are ready to pay for a membership card that grants them an exclusive privilege to buy at a warehouse store, it’s not a new concept in the country,”

    Costco also takes encouragement in that – despite the failures of European hypermarket chains Carrefour, Tesco and Metro in the Chinese market – its US rival Sam’s Club, operated by Wal-Mart on a similar business model, has been trading there for 20 years.

    “A mature market saves us efforts in educating customers.”

    However Jason Yu, GM of Kantar Worldpanel China, is less bullish about Costco’s prospects there.

    “The Chinese market is very complicated and requires retailers to innovate and localise,” he said.

    Local retailers like Hema, Alibaba’s tech-enhanced food store network, are proving popular with consumers and can adapt quickly to changing consumer preferences.

    “Local retailers are reaching out to customers via all distribution channels while foreign retailers are not so flexible to adapt to new situations,” he said. “The old way of a large and all-inclusive hypermarket doesn’t work in China.”

     

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  • Costco China to launch in August

    Costco China to launch in August

    US-headquartered warehouse-club retailer Costco Wholesale will open its first physical store in Mainland China in August.

    Costco China’s first location will be in Shanghai’s Minhang district, offering memberships to family and corporate consumers at RMB299 (US$43). The firm’s membership strategy has been largely successful in most markets, with an 88-per-cent renewal rate globally.

    “Costco is good at building a loyal shopper base through its paid membership program with low prices and a select number of stock-keeping units,” said Kantar Worldpanel China GM Jason Yu on Costco China’s debut. “The question is whether they can replicate this in China easily.”

    The group will prove strong competition for Walmart China’s Sam’s Club, a premium goods retailer targeting high-end buyers and which has been accelerating store expansion for the past two years, with a target of reaching 40 locations in the territory by next year.

    Costco now has 773 warehouses worldwide and operates e-commerce sites in several international markets.

    Costco has also announced plans to launch in New Zealand, with the first store scheduled to open in 2021.

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  • Costco Japan Launched new E-commerce Website

    Costco Japan Launched new E-commerce Website

    Costco Japan says it plans to launch an online store next year.

    The wholesale club-style retailer is still finalising plans for the site, in particular the exact launch date and the product range it will offer online. But it says it is committed to the e-commerce business given how Japanese consumers are increasingly buying goods over the internet.

    As with its physical stores, customers of the online store will have to pay an annual membership fee before they can purchase goods. That fee is currently ¥4752 (US$43).

    Meanwhile, Costco Japan plans to expand its network of hypermarkets from 26 to 50 by 2030. It is also building new distribution bases in the Chiba and Hyogo prefectures to prepare to service online customers and new stores.

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  • Aldi, Costco bring prices down of groceries

    Aldi, Costco bring prices down of groceries

    International grocery giants Aldi and Costco are driving down fruit and veg prices in Western Australia at a faster rate than anywhere else in the country, according to new research.

    Analysis conducted by Bankwest has found that Perth shoppers spent 6.9 per cent less on fruit and veg in the year to September 2017 than the previous year, signalling a step up in competitive intensity among Australia’s major supermarkets as discounters increase their investment in the state.

    Overall food and non-alcoholic beverage prices declined by one per cent in the twelve-month period, 0.3 per cent higher than the nationwide average decline of 0.7 per cent.

    Over the last three years prices have declined by 1.4 per cent in Perth, with average grocery basket price declining by 5.1 per cent from $177.7 to $168.6 in the year to June 2016.

    Richard Bator, Bankwest’s general manager of business banking in WA, said that discounters are rapidly growing their market share out west.

    “The supermarkets industry is now one of the most fiercely competitive industries in the nation due to the rapid growth of international retailers competing for a share of the $100 billion industry.”

    German entrant Aldi began its expansion into Western Australia in 2016 and has been investing heavily in the market, while American giant Costco unveiled plans for two Perth locations by the end  of 2019 in March.

    In the year to June 2016 the average price of a grocery basket in Western Australia declined by 5.1 per cent  from $177.7 to $168.6 – prices have declined 1.4 per cent over the last three years.

    Smaller retailers have been adversely impacted by the increase in competition, particularly as Coles and Woolworths move to improve their fresh offers to shore up their own operations.

    Bankwest found that the number of grocery retailers employing less than 20 staff fell by 10.6 per cent in the year to June 2016.

    The story is more positive for the overall market, Bankwest said, which is projected to grow by 9.3 per cent in the five years to June 2022.

  • Costco China planning first store opening

    Costco China planning first store opening

    Costco China plans to open its first store in China next year, even as other international retailers like Lotte and Tesco scale back because of market barriers and disappointing sales.

    The American wholesale giant has signed an agreement with state-owned Shanghai Pudong Kangqiao Group to set up the headquarters of its Chinese business in Kangqiao, in Shanghai’s Pudong district, according to local media reports. Costco is also opening a membership retail club store with Shenzhen-based real-estate firm Galaxy Holding.

    Kuaxiaopin.net says Costco will open its first physical store for China in Shanghai’s Minhang district next year. A second store is planned for Pudong, to open in 2021.

    The retailer has been targeting Chinese consumers since 2014 via Tmall, the online marketplace of e-commerce giant Alibaba where it sells branded products including healthcare and personal care goods.

    Costco currently has 749 warehouses, including 519 in the US and Puerto Rico, 98 in Canada, 38 in Mexico, 28 in the UK, 26 in Japan, 14 in Korea, 13 in Taiwan, nine in Australia, two in Spain, one in Iceland and one in France. The company also has e-commerce sites in Canada, Korea, Mexico, Taiwan, the UK and the US.

  • New USA tariff plan draws backlash from US retailers

    New USA tariff plan draws backlash from US retailers

    Failing US president Donald Trump is facing widespread backlash from US retailers and brands over his intention to trigger a trade war with China and other nations.

    Just days after announcing tariffs on steel imports against the advice of officials, lawmakers and industry, Trump is now believed to be formulating sweeping tariffs on imported goods from China – a move retail and business groups warn will wipe away gains for the economy from the recent tax cuts.

    “This is not American industries crying wolf,” said Sandy Kennedy, president of the Retail Industry Leaders Association, which organised a letter to Trump, sounding alarm that such tariffs will boost prices of numerous consumer goods, including shoes, apparel and appliances.

    Twenty-four US retailers signed Kennedy’s letter, including Walmart, Target, Best Buy, Abercrombie & Fitch, American Eagle Outfitters, Columbia Sportswear, Costco, Dollar Tree, Gap, JC Penney, Kohl’s, Ikea, Levi Strauss, Sears, VF Corp and Wolverine World Wide.

    A second letter was signed by 82 shoe companies, including Nike, Payless ShoeSource, Under Armour and Shoe Carnival.

    “Adding even more tariffs on top of this heavy burden would mean higher costs for footwear consumers and fewer US jobs,” one of the letters said.

    “Given the price sensitivity of our products, any additional increases in our costs would strike right at the heart of our ability to keep product competitively priced for our consumers.”

    One of the issues worrying retailers and manufacturers is that Trump does not need approval from Congress to implement tariffs. He can impose unilateral tariffs on China citing national security grounds – the same rationale behind the steel tariffs – because a US government investigation had found Chinese had violated intellectual property rules.

    Trump has previously stated he does not fear a trade war because he believes America would win it.

    Widespread media debate about tariffs and the rationale behind them would also distract public attention from numerous controversies surrounding the Trump presidency, including a growing list of women revealing extramarital affairs with him, election tampering and his links to a company under investigation by the FTC for stealing personal details of 50 million Facebook users.

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  • Costco to open third Sydney outlet at Marsden Park

    Costco to open third Sydney outlet at Marsden Park

    Bulk discount retailer, Costco, will open its third Sydney outlet, and ninth store nationwide, at Marsden Park in Sydney’s northwest next week.

    The Costco Marsden Park store, which will span 13,575sqm, will include a Costco fuel station, tyre centre, food court, optometrist, hearing aid services and fresh food production.

    The site is located within the large format retail precinct at Sydney Business Park, in Marsden Park. Costco is the latest major retailer to open at the Business Park, which is one of Australia’s largest large format retail centres, spanning 115,000sqm in floor space.

    Owen Walsh, Sydney Business Park project manager, said Costco is a welcome addition to Sydney Business Park, which, is fast becoming a major shopping and warehouse distribution and logistics destination for the region.

    “We are pleased to be part of Sydney’s rapidly growing northwest, and it is rewarding to see the community growing around Marsden Park and the Sydney Business Park,” Walsh said.

    Walsh said in the last five years, the Marsden Park community has completely transformed with the establishment of major new retailers opening their doors.

    “New retail has created new jobs and that has attracted people to relocate here to be closer to where they work or to find work,” he said. “The next five years will see even more dramatic transformation with major commercial towers to be built as well as a major town centre. By 2025, the surrounding North West Growth Centre is expected to support 177,000 new residents and 61,900 new homes.”

    Sydney Business Park has secured approximately $600 million in investment to date, on track as part of the broader $3 billion project.

    Patrick Noone, Costco Wholesale Australia managing director, said the company was very pleased with the new site and said the store opening marks another significant milestone for the company.

    Costco joins other retailers at the centre including Aldi, Baby & Toddler Town, Beacon Lighting, Bunnings Warehouse, Carpet Call, Coles Express, Costco Wholesale, Forty Winks, Home Consortium Marsden Park, Home Hub Marsden Park, Ikea, JB Hi-Fi Home, Knotts Pine, Lindt Factory Outlet, Reece, Repco, Shell, Snooze, and The Good Guys, among others.

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