Costco is known for a lot of things, such as bulk toilet paper and 72-pound cheese wheels, but curbside pick-up for groceries isn’t one of them and Chief Financial Officer Richard Galanti is just fine with that.
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“We don’t have our head in the sand on it, we look at it, we have people here who study it, maybe we’ll surprise you one day but at this juncture, we are not prepared to do that,” he said during the Q&A portion of the company’s earnings call Thursday.
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The warehouse retailer does offer same and two-day delivery options for groceries but has faced some criticism for lagging on curbside pick-up, while rivals such as Walmart and Target are full throttle.
"We watch what others are doing," Galanti told FOX Business while also noting the strong sales numbers Costco raked in last quarter.
Total comp-store sales rose a record 14.1%, while e-commerce sales jumped a whopping 91.3% compared to the same period a year ago.
While supply chains are returning to normal post-COVID-19 some in-demand items, according to Galanti remain in tight. There are “still some limits on paper goods but it’s getting better. The toughest area overall is sanitizing wipes as well as latex gloves” he noted.
While in-store shopper traffic dipped during the height of the pandemic, Galanti told FOX Business these same customers are buying more goods measured by a 12.7% jump in the average basket size vs. a year-ago.
As the pandemic swept the country, consumers loaded up not only food items but household goods such as televisions and lawn furniture.
Costco reported net income in the fourth quarter rose to $1.39 billion up from $1.09 in the year-ago period. However, the quarter "was negatively impacted by incremental expense related to COVID-19 premium wages and sanitation costs of $281 million pretax."
The company remains committed to keeping hazard pay [premium wages] for at least 8 of the 12 weeks in the current quarter.
Costco shares have gained 18% this year compared to a 0.5% rise for the S&P 500.