Though Costco remains considerably larger in terms of revenue and number of store locations, the smaller public wholesaler is making changes to its business model to more effectively compete.
BJ’s Wholesale ClubAdobe Stock
Author’s Note
This article is based on corporate postings and accredited media reports. All linked information within this article is fully-attributed to the following outlets: EatThis.com, RetailLeader.com, Costco.com, TheStreet.com, BJs.com, Statista.com, SupermarketNews.com, and DrugstoreNews.com.
Introduction
On April 5, 2022, EatThis.com published “5 Major Differences Between Costco and BJ’s Right Now,” by Alex Perry. According to Perry, who hyperlinks RetailLeader.com and Costco.com in the article for attribution, the typical BJ’s location reportedly carries approximately 7000 products, while Costco offers about 4000 SKUs (stock keeping units) compared to the 30,000 found at most supermarkets.
See hyperlinked RetailLeader.com page here, and Costco.com page here. Though the former article is dated May 12, 2017, Perry states: There isn’t much word on if the number of items has changed since then, but the company says the number of items is “roughly double the assortment found in Costco or Sam’s Club but well below what is found in a typical supermarket and dramatically less than what Walmart or Target offer.”
Among other differences between the two wholesalers include the lack of a food court at BJ’s, and BJ’s accepting coupons while Costco does not.
In the current calendar year, however, BJ’s has been making moves to be more competitive with the larger entity.
Let us explore further.
BJ’s Wholesale Club, 2022
In Daniel Kline’s March 7, 2022 article for TheStreet.com, entitled “BJ’s Warehouse Club Targets Costco and Walmart’s Sam’s Club,” the writer discusses a fourth-quarter earnings call by BJ’s CEO Bob Eddy that promised upcoming innovation: That innovation will at least partly take the form of a new test concept in Warwick, Rhode Island. Called BJ’s Market, the club will serve as an innovation lab for the brand, allowing it to test “out new assortments, displays, product demonstrations, and convenience initiatives,” according to a press release.
Another innovation listed in Kline’s piece regards plans for an ambitious expansion on the part of BJs. Presently, according to BJs.com: The company currently operates over 215 Clubs in 16 states from Maine to Florida and employs more than 25,000 Team Members.
In Kline’s piece, he also mentions BJ’s location count is presently “about a third of what Sam’s Club has and about a quarter of Costco’s total.”
As far as revenue, Statista.com reported the following: In 2021, Costco generated 141.4 billion U.S. dollars in revenue from their operations in the United States. Costco operates warehouse clubs in a number of countries around the world.
Regarding BJ’s, per SupermarketNews.com, 2021 was the wholesaler’s best year: BJ’s fiscal 2021 net sales totaled $16.31 billion, up 8% from $15.1 billion in 2020.
BJ’s Wholesale Club has a ways to go in all departments if they are to truly be a threat to Costco, but current business trends for the company are certainly optimistic in terms of continued growth.
Conclusion
In terms of public wholesalers, Costco, and also the Walmart-owned Sam’s Club, are considerably ahead of BJ’s in terms of all business metrics.
However, certain moves including ambitious expansion plans are expected to, at least in part, close that gap.
In March, 2022, DrugstoreNews.com elaborated on those plans: The Westborough, Mass.-based retailer recently shared plans to open four new clubs as part of the first phase of its 2022 development plans. Located in Warwick, R.I.; Lady Lake, Fla.; Canton, Mich.; and Greenburgh, N.Y., each of these new locations plans on providing consumers with the wholesale club experience it is known for, as well as value and convenience, the company said. “We continue to accelerate our expansion and we’re excited to open these new locations,” Bill Werner, executive vice president of strategy and development at BJ’s Wholesale Club said.
Thank you for reading.
