Costco Wholesale Canada Competition
Now Viewing Costco Wholesale Canada's competition in: Warehouse Clubs and Superstores (primary)
Recent Developments
Sam's Club Testing Business Center Concept - Sam's Club opened a pilot Sam's Club Business Center in Houston in August 2008, which caters to small business owners by offering more than 2,500 business-essential items. Instead of consumer offerings like pharmacy and jewelry departments, shoppers will find more business-oriented products and services, such as expanded copy and print operations. Commercial members account for fewer than half of Sam's Club memberships, but are about 50 percent of the chain's revenue. If the Houston pilot is successful, more stores could be converted to business centers, opening the door for competitors to pick up the club's consumer business.
Costco Reports Better than Expected Same-Store Sales - In July 2008, Costco Wholesale reported a 10 percent increase in sales at stores open at least a year, raising the bar for competitors in the warehouse club and superstore industry. Wall Street had forecast the company's same-store sales, a key indicator of performance, to rise 7.8 percent. The soaring price of gas helped boost sales and attract shoppers, the company says. Costco's food sales also remain robust: it saw its strongest US results in the Midwest, Northwest, and Southeast, and in Texas.
Green Consumers Spend Big at Warehouse Clubs - LOHAS (Lifestyles Of Health And Sustainability) consumers spend more in warehouse clubs than other channels, such as grocery and drugstores, according to Nielsen. Specifically, LOHAS consumers spend 10 percent more in warehouse clubs than other food and drug stores. These "green" consumers are also top spenders in consumer packaged goods categories that offer a wide range of organic, all-natural, and environmentally friendly options, such as produce, cereal, pasta, nuts, and light bulbs. Knowing where these influential consumers shop and what they're buying, says Nielsen, presents marketing opportunities for retailers.
Competitive Landscape
Demographics and small business growth drive demand, and spending in warehouse clubs generally resists economic cycles. The profitability of individual companies depends on high volume sales, low-cost purchasing, and efficient distribution. Large chains dominate the market due to advantages in purchasing, distribution, and finance. Average annual revenue per employee is about $230,000.
Warehouse Clubs and Superstores Industry Forecast
from Hoover's/D&B subsidiary First Research
The output of the US retail industry, which includes warehouse clubs and superstores, is forecast to increase at an annual compounded rate of 4.2 percent between 2007 and 2012.
Retail Industry Growth Level
First Research forecasts are based on INFORUM forecasts that are licensed from the Interindustry Economic Research Fund, Inc. (IERF) in College Park, MD. INFORUM's "interindustry-macro" approach to modeling the economy captures the links between industries and the aggregate economy.

First Research Opportunity Rating
The First Research Opportunity Rating is First Research's estimate of industry performance vs. industry risk over the next 12 to 24 months.

- Demand: Tied to consumer income
- Need good merchandising
- Risk: Slowing economy limits spending on non-essentials
Industries Where Costco Wholesale Canada Competes
- Retail
- Discount & Variety Retail
- Warehouse Clubs & Superstores (primary)
- Gasoline Retailers
- Grocery Retail
- Nonstore Retail
- Discount & Variety Retail





