Interesting because I had not yet heard of any location outside of Florida and Texas for the new Sam's expansion. They are going to start opening 20 to 30 warehouses a year once the distribution centers are set up. I had not seen an announcement of Visalia but it doesn't surprise me.reymann wrote: ↑April 24th, 2024, 9:04 am Sam's Club may be in expand mode in the central valley as they are opening a store in Visalia and are looking at locations in Clovis. Costco is looking for sites in SE Fresno for future expansion as the Sunnyside and Fancher Creek areas are going to see growth in the coming years as will Sanger.
Also the new Sam's clubs are being built larger than new Costco stores. Their larger stores with all the amenities are a differentiator Costco won't touch due to labor cost (like the full service Meat counters and Sushi kitchen, along with juice bars). Costco has tested sushi but is only doing it slowly with one store and expanding to two more in Seattle but those will use outsourced vendors. The new Sam's stores will all be around 170K Sq ft which is what Costco used to build, the new Costco prototype is 150K and as stated previously is too small with weird corners pinched that create traffic flow problems all over the store then they have to remodel them at great expense later to squeeze a few more inches out.
Here's the thing that will make them competitive where they weren't before: they're shifting to attract more affluent, younger customers who are tech savvy. So Northern California, Oregon and Washington are definitely places they will want to go. This is one of the most tech savvy areas in the US and once those customers get their hands on Scan and Go they're going to sell all of their friends on it and put Costco into a real bind. Remember they don't need to "put Costco out of business" all they need is to steal some of their sales. Sam's is going to be like Lowe's or Target versus Home Depot and Walmart, they know they can't beat Costco but they can certainly become a stronger second choice. That aspect has to have Costco very concerned that Sam's may finally have a means to get into Norcal and beyond when their old format didn't catch on previously. So it will be all about locations, if Sam's can't get the real estate they won't be successful in getting in. They can of course use the Trojan Horse strategy and claim to be finding Walmart Supercenter sites only to flip them to Sam's Club... Plus if they're smart they will sign sites as fast as possible that would work for either brand, then if they can't get enough Sam's locations to launch a full attack they could just open them as Walmart stores without taking a loss on the real estate.
It is interesting that Costco is doing something experimental with this Fresno warehouse and e-commerce center. Wonder if they'll try some tech solutions, curbside pickup or other innovation there...