Costco Corp. plans to open 21-22 warehouses a year, with about 75 percent of those initially planned outside the United States, a percentage that will change to 50-50 in the next several years, according to a report in industry trade publication Food Institute Report. Overall, membership renewal rates are more than 90 percent in the U.S. and Canada, according to a conference call Chief Financial Officer Richard Galanti recently held with analysts.
The report notes that the Issaquah-based retailer sees “ a lot of opportunity in both Asia and Western Europe.”
Costco will open its first warehouse in Shanghai, China this month and already has 60,000 paid members signed up. It plans another warehouse in China in about two years. Costco recently rolled out executive membership in South Korea, with Japan and Taiwan expected to follow.
Though 67 percent of first-year members renew in the U.S., that number drops to 50 percent internationally, so “the company will place emphasis on analytics to improve renewal rates through greater reach-out campaigns, communicating the benefits of upgrading memberships to the higher tier, as well as better highlighting services,” the report says.
Costco, which recently released a digital membership card, operates 768 warehouse stores, including 523 in the United States.