Costco CEO Craig Zelinek said Monday that the company’s body stores will continue to move forward despite wholesale retailer e-commerce sales increased during the Corona virus outbreak.
“Our overall online business will continue to grow. Are we cunning? No, we will not,” Zelinek told Closing Bell. “We will continue to bring value to high quality and quality products, and deliver through warehouses, brick and mortar or e-commerce.”
Costco built a reputation for its personal shopping experience before the epidemic, buying cheap items such as hot-dog-and-soda combo at its food court for 50 to 1.50. But many Costco members have returned to its website this year, leading to strong online sales growth experienced by many competitors.
Nov. This is a 91% increase in online sales per year.
“We are going to continue to build that business,” Zelinek said, noting some of the technical investments the company has made. For example, in March, Costco acquired Innovative Solutions for $ 1 billion, providing last-mile delivery services. It is owned by the company that operates the Sears and Gmart stores.
“We see a great opportunity to build our last mile business with big ticket products, bulk items … our clothing business continues to grow online,” Zelinek said.
Nonetheless, having the members store in store is an essential item for the retailer, Zelinek said. “It’s more important to get people physically in stores. I still think brick and mortar is not going to go. We want to get people in stores regularly. The best way to do that is for $ 1.50 a dog and a rotisserie chicken for 99 4.99,” he said.
During epidemics, Costco saw customers storing items such as toilet paper, which led to limits on the number they could buy. Zelinek said that as corona virus cases are on the rise across the United States and state and local authorities are re-enforcing public health restrictions, some stock behaviors from shoppers are beginning to reverse the decline. However, he said it was “not the same size” as it was this spring during the early waves of the epidemic.
“They’re still buying extra toilet paper, hygiene products and the like, so make sure you keep some of them … because they will continue to be some of the long-term requirements,” Zelinek predicts. .
Shares of Costco closed Monday’s session at $ 374 each. The stock is up about 27% to date.