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Deep Dives 11 minutes

Have Warehouse Clubs Embraced E-Commerce?

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Coresight Research

Key Points

In this report, we analyze how warehouse clubs have recently sought to compete with online-only retailers and omnichannel rivals.

  • As the growing penetration of e-commerce brought greater competition from players such as Amazon, warehouse clubs started to see their limited e-commerce capabilities as a significant weakness.
  • Warehouse clubs began placing a greater emphasis on e-commerce and omnichannel capabilities, which involved developing same-day and two-day grocery delivery, rolling out buy online pick up in store (BOPIS) services and opening e-commerce fulfillment centers.
  • Thanks to these efforts, e-commerce’s share of Costco’s total sales has been steadily rising and constituted 4% of net sales in the year ended September 2, 2018.
  • At Sam’s Club, e-commerce generated 4.7% of total net sales in the year ended January 31, 2019.
  • In May 2017, BJ’s appointed Rafeh Masood as its first ever chief digital officer.
  • Warehouse clubs must find the optimum balance between in-store operations and e-commerce, and getting this right could prove instrumental in supporting long-term growth for the clubs.

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