Costco beaten again in America's grocery wars... but it's taken a huge bite out of the competition
The membership-based warehouse giant is gaining ground on grocery king Walmart.
Walmart now hoovers up one in five dollars spent on groceries in America, according to new data from consumer analytics firm Numerator.
If Sam's Club, Walmart's answer to Costco, is included, then that figure rises to a staggering one in four dollars.
Walmart may be twice the size of its nearest rival Kroger, but it's Costco that rivals are losing their business to.
Costco has been snapping up grocery spending since 2019, increasing its share of the market from 7.6 percent in 2023 to 8.5 percent now, Business Insider reported.
Since Costco focuses on offering bulk quantities of a limited number of products, it it unlikely to ever take up the biggest share of the grocery market, but it is positioned to take more of it.
Costco's focus on value will be a draw for consumers looking to cut back their spending amid an uncertain economy and increased costs from tariffs.
Costco also sells a wide range of products which tend to have higher margins than groceries, helping to boost the company's bottom line.
Costco's success has also been attributed the success of its Kirkland brand.
'Costco is leveraging the fact that their entire store and organization are a single brand,' industry expert Gary Sankary recently told The Street.
'Watching big boxes cycle through the process of introducing and retiring their owned brand labels every few years to convince customers that new is better, at the same time, is confusing and, in many cases, dilutes their brand.'
'The Kirkland brand quality is not by any means diluted just because it is private label,' retail consultant Robert Amster agreed.
A recent success story is the $13.99 Kirkland 12-pack of Helles-Style Lager that has received rave reviews.
Made by the Deschutes Brewery in Bend, Oregon, the German-style lager was released exclusively in Costco in November.
The beer is based on a recipe that won a gold medal at 2023's Great American Beer Festival.
Costco's focus on value will be a draw for consumers looking to cut back their spending amid an uncertain economy and increased costs from tariffs
It is now sold in every state except Texas, and a new version will be released annually.
Other Costco products that have received expert approval include the award-winning Kirkland Signature Coastal Cheddar Cheese.
The 15-month-aged cheese, made at a farm on the UK's Dorset coast, costs just $10 for a two-pound block.
Costco members also enjoy a range of perks including access to free hearing screenings, a generous returns policy and much-loved food court deals.
As well as the legendary $1.50 hot dog and soda offering Costco recently reintroduced its hot turkey and provolone sandwich.
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