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Costco Wholesale Corp. is enjoying a foot-traffic boost thanks to back-to-school season, according to data from analytics company Placer.ai.
“Costco Wholesale is on a roll,” wrote Shira Petrack, Placer.ai’s marketing content manager, in a blog post Thursday. “The company’s relative visit share within the superstore space has steadily grown over the past couple years, and the wholesale club led its category in terms of year-over-year (YoY) visit growth during the recent Back-to-School season.”
Costco saw year-over-year visits increase 3% during August, 4.5% in July, and 3.6% in June, according to Placer.ai’s data. In contrast, other wholesale clubs and superstores, saw visits decline 1.9% in August and 0.4% in both June and July, respectively. The wholesale giant recently reported net sales of $18.42 billion for the four weeks ended Aug. 27, 2023, an increase of 5% from $17.55 billion in the same period last year.
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Placer.ai’s Petrack says that Costco appears to have recovered from some of the headwinds facing the wider retail space earlier in 2023. “While some of the growth in foot traffic is due to the company’s ongoing expansion, same-store visits are also on the rise with average visits per venue metrics seeing increases year-over-year (YoY) between June and August 2023 as well,” she wrote.
The wholesale giant’s visits per venue increased 0.7% year-over-year in August, 2% in July, and 1.5% in June. This outpaced the broader wholesale clubs and superstores segment, which saw visits per venue decline 1.8%, 0.3%, and 0.4% during those same months, respectively.
The Garden State delivered Costco’s strongest foot traffic, with New Jersey seeing 6% growth between January and August 2023 and the same period in 2022. This was followed by Illinois and Florida which saw 4.9% and 3.2% growth, respectively. Nationwide, visits were up 1.9% year-over-year during the same period.
Related: Costco to clamp down on sharing of membership cards
“Costco’s ability to open new stores without cannibalizing traffic from its existing venues speaks to the strong demand for the concept – and suggests that the chain has not yet maximized its expansion potential,” wrote Petrack.
The company opened 14 new locations in the first three quarters of its fiscal year and, as of Aug. 30, operated 861 “warehouses” globally. These include 591 in the United States and Puerto Rico, and 107 in Canada.
Costco reports fourth-quarter results after market close on Sept. 26. Analysts surveyed by FactSet expect the company to report earnings of $4.79 a share and revenue of $77.72 billion.
Related: Costco e-commerce sales drop 2.5% in August
Earlier this week Raymond James reaffirmed its outperform rating for Costco ahead of the retailer’s fourth-quarter earnings. Of 37 analysts surveyed by FactSet, 25 have an overweight or buy rating, 10 have a hold rating and two have an underweight rating for Costco.
Costco’s stock has risen 23% in 2023, outpacing the S&P 500 index’s gain of 13.3%.
