ISSAQUAH, Wash., and WESTBOROUGH, Mass. — Costco and BJ’s Wholesale Club continue to produce solid sales growth, aided by high gas prices, shoppers’ desire to save money and the clubs’ ability to pass through the cost of food price inflation.
A 10% same-store sales increase at Costco during July looks impressive on the surface, although there is a fair amount of noise surrounding that headline number that require further dissection. For starters, the company said its July reporting period included one fewer day this year and that caused total sales and same-stores sales to be negatively affected by 3% worldwide, or 3.5% in the United States. The impact of one less selling day due to the closure of U.S. clubs on July 4 was offset by high gas prices and a weak dollar that also distorted comps.
For example, the company reported a U.S. comp increase of 6%, but that figure is cut in half to 3% if the beneficial effect of higher year-over-year gas prices are excluded. Internationally, the impact of the weak U.S. dollar is even more pronounced. Costco reported international comps of 22%, but on a constant currency basis the figure dropped to a still very respectable increase of 12%.
The company’s monthly results are further muddied by inclusion of sales from a Mexican joint venture. Costco noted that sales for July increase 15% to $6.7 billion, but that figure includes results from a Mexican joint venture without which the increase would have been 12%. Through the first 48 weeks of the company’s fiscal year Costco’s sales rose 14% to $80.2 billion, but take out results from the Mexican joint venture and the increase would have been 11%.
The sales picture at BJ’s Wholesale Club is a lot clearer as its 190 units are all located in the United States, so the only distorting factor is the price of gasoline. BJ’s said its July same-store sales increased 9.2%, but excluding gasoline sales, the comp figure was 5.4%. Total sales at BJ’s increased 12.4% to $854.8 million.
The second quarter now is in the bag at BJ’s, and total sales for the period ended July 30 increased 11% to nearly $3 billion and comps increased by 7.8%, including a contribution from sales of gasoline of 4%.
Costco’s fiscal year will ended on Aug. 28. Between now and then, the company plans to open five new clubs that will push its total close to 600 units worldwide. The company ended July with 587 clubs, consisting of 428 in the United States and Puerto Rico, 81 in Canada, 32 in Mexico, 22 in the United Kingdom, eight in Japan, seven in Korea, six in Taiwan and three in Australia.