Warehouse clubs remain a niche retail category in France as only one outlet remained in operation mid-2021, under the operation of the US-origin chained Costco upon its entry into the country in June 2017. The introduction of this business model has been well received by French consumers, with the store having than 160,000 cardholders in mid-2021.
The opening of a second outlet in France (November 2021) will probably come too late to really change the sales growth of Costco France – although the rush of the festive period had a positive impact. Nonetheless, even without taking this opening into consideration, the only warehouse club chain in France has managed to operate well throughout the challenges created by the ongoing COVID-19 outbreak in 2021 enabling it to experience strong double-digit value growth over the previous year.
For the moment, sales of Costco France are expected to continuously expand. No other direct competitors are expected to enter the niche of warehouse clubs in the short term.
With the quarantine lockdown and the wider COVID-19 pandemic having stimulated changes in the way French people shop and consume, it will be necessary for Costco to focus on developing its offer during the forecast period in order to remain relevant and continue catering to the needs of French consumers. One factor to take into consideration is that the adverse economic situation that has emerged as a result of the interruption caused to commercial activity in key sectors of the French economy at the peak of the COVID-19 pandemic means that a more circumspect and conservative approach to spending is likely to be seen among the French population throughout forecast period.
Costco France will continue to track other opportunities of outlet opening in the short term. It plans to open six outlets in Ile-de-France (the main region of Paris) and a further six to nine outlets in other regions during the forecast period.
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Warehouse clubs are chained outlets that sell a wide variety of merchandise, typically situated in out-of-town locations, with a selling space of over 2,500 sq metres (and invariably over 4,000 sq metres in total size). Customers have to pay an annual membership fee in order to shop. The clubs are able to keep prices low due to the no-frills format of the stores and large volume SKUs. Example brands include Costco, Sam’s Club (Walmart), and Atacadão. Excludes sales attributable to membership fees and business-to-business sales. Also excludes cash & carry and warehouse outlets (which are typically oriented towards businesses, rather than consumers). Note: Local variants, such as atacarejos in Brazil, are included in this channel.
See All of Our DefinitionsThis report originates from Passport, our Warehouse Clubs research and analysis database.
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