Costco’s Richard Galanti, Executive Vice President and Chief Financial Officer, recently detailed the club retailer’s dive into competitive online grocery retail waters. In a Retail Info Systems (RIS) report, he talked strategy, expectations, and plans to expand its delivery-available options.
“We did go and spend hundreds [of thousands], if not $1 billion dollars around delivery,” said Galanti. “We’re doing it actually as a partner of UPS, limiting the things that we do, and it seems to be working.”
RIS reported that two-day delivery is now available to Costco members throughout the United States. Same-day delivery is also available to members within 20 minutes of 99 percent of all the company’s U.S. locations.
“My guess is there are going to be some things that we're currently doing third-party that we will bring in-house as we get better and more confident in being able to do it,” continued Galanti, who also touched on the company’s efforts to expand its distribution channels. “In terms of warehouse expansion, we've opened eight locations, including two relos, so a net of six in the first quarter…For all of '19, we expect to open 20—about 23 net new warehouses, as well as four relocations. The two we've opened plus two more planned for the rest of the year. Within the 23 net new, about three quarters of them are in the U.S. and about a quarter of them are international.”
To learn more, read RIS’s report in its entirety here.