The US big box retailer pursues more locations in rapidly developing suburbs, Costco has planned a significant expansion into Australia with plans to open 20 new warehouses over the course of the next five years.
If it can obtain appropriate land and planning approvals, the proposed rollout would more than double the company’s current footprint of 15 warehouses across the country.
Initial projects are already beginning to take shape. In an effort to accelerate its growth beyond the consistent additions of recent years, Costco plans to open two new warehouses in Victoria and Western Australia next year.
In order to capitalize on rapidly expanding business and increased commuter traffic they are also conducting site searches for additional locations in north and south Sydney, Perth and Adelaide.
Additionally, the retailer is preparing to open its first stores in Geelong and Tasmania, indicating a push into markets that it has not yet entered.
The requirements are substantial according to observers of the real estate sector, which may restrict options.
Costco typically targets areas with a population of 400,000 to 500,000 and good access to major roads.
A typical Costco warehouse requires approximately 14,000 square meters of building space and 800 parking spaces.
In Perth’s north, a third WA Costco has been proposed for Alkimos, where it is expected to be part of a larger retail and trade hub development.
According to Seven News, retail expert Gary Mortimer said that Costco turned a profit of around $500 million after tax in the last financial year.
This is helping the company pursue a long term land grab strategy as more families begin to shop around for deals.
Costco’s membership pricing begins at $65 per year, increasing to $130 for an executive membership and the company has relied heavily on fuel discounts and bulk pricing to lure customers during the cost of living crisis.
