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- Costco’s instore sales are growing as foot traffic is down overall among retailers.
- The company is seeing increased revenues during the pandemic.
- Consumers are trending towards fewer trips, but spending more during each trip.
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Costco continues to buck the trend of declining foot traffic hitting its competitors.
In October, traffic in US stores was up 6%, the second consecutive month of traffic growth for the big box retailer even as other retailers face declining instore sales, according to UBS Consumer Research.
In the US, sales increased by 16.4% in October, and the average transaction grew by 9.4% over the month, the research report said.. Larger transactions could be in part connected to increasing coronavirus cases in the Midwest and western states toward a projected fall and winter wave of the pandemic.
“We believe COST can sustain both its traffic and ticket momentum as COVID cases are on the rise across certain geographies both in the US and in Europe…Costco remains well-positioned going forward” UBS Consumer Research wrote in a report.
Costco is actually benefiting from the pandemic. In September, it reported revenue was at $167 billion, up 10% from the previous year. The company says this growth was driven by both increasing sales and increased membership fee earnings.
Some retailers are also seeing foot traffic pick back up, like Aldi, Kroger, and Walmart, while Whole Foods’ bounce back is comparatively slower. Customers across the board are always changing how they shop, consolidating visits and buying bigger hauls when they do go out. This represents a “remarkable shift in the way consumers are shopping,” according to Neil Saunders, managing director of GlobalData retail.
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