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Costco Reports Higher April Sales

05/11/2022

Egg-NewsOn May 4th, Costco Wholesale Corporation reported that April sales rose 13.9 percent to $17,330 million compared to the corresponding month in 2021.  Same-store sales were higher by 12.6 percent and E-commerce rose by 55.7 percent.

 

Costco shoppers will soon be faced with an increase in their membership fee, estimated to correspond to the rate of inflation.  Standard membership is expected to rise by $5 to $65 annually with the executive membership attaining $130. Costco is confident that the increase will not impact membership that has a 92 percent retention rate for North America.  Costco gained 800,000 members during the first quarter of 2022.

Egg-News

Surveys to judge loyalty and satisfaction consistently place Costco above competitors including Target and Walmart.  Among the supermarket ratings, Costco scored 81 compared to Target at 77 and Walmart at 70.

 

Analysts ascribe the success of Costco to the policies applied by founder, Jim Sinegal. He advocated stocking products in the proportion of 75 percent ‘needs’ and 25 percent ‘wants’ that he referred to as, “triggers and treasures”.

 

An important component of Costco’s success is the high rate of inventory turnover, estimated at 12 or more times per year.