Latest news with #RonVachris
Globe and Mail
2 days ago
- Business
- Globe and Mail
Costco Counters Tariffs with Strategic Sourcing and Bulk Orders
Membership-only retailer Costco Wholesale (COST) reported its third quarter fiscal 2025 results yesterday, marginally outpacing expectations for both earnings and sales. The company said that consumers are pre-ordering goods and making bulk purchases in anticipation of future tariffs. This has helped the retailer to avoid raising prices and maintain its 'competitive price position.' Confident Investing Starts Here: Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter CEO Ron Vachris noted that, 'We're watching pricing daily, if not hourly, on every key commodity.' Notably, 8% of Costco's goods sold in the U.S. are imported from China, with nearly one-third coming from other countries. Consumers have already stocked up on many summer goods such as patio furniture and sporting equipment, helping Costco to maintain stable prices on them. Here's How Costco Is Mitigating Tariff Impact In the post earnings call, the company noted that it has pulled forward shipments of certain goods to mitigate the potential impact of tariffs this summer. Costco is also re-routing goods sourced from countries facing heavy tariff burdens to its non-U.S. markets. Effectively, it is importing goods into the U.S. from those countries with minimal tariffs. It has also been able to lower prices on essential items like eggs, butter, and olive oil. Costco is also working on shifting production of goods to countries with lower tariffs. Meanwhile, its private-label goods, which offer better value for money, are being preferred over more expensive goods. This, coupled with bulk purchases by customers, has helped Costco deliver solid comparable sales and exceed expectations. Costco has previously stated that raising prices of its products would be a 'last resort,' and the company is living up to that promise, while peers Walmart (WMT) and Target (TGT) are struggling to strategize effectively. Costco saw high-single-digit same-store sales in the fresh food category and double-digit growth in meat. Plus, discretionary items such as jewelry, home furnishings, small electronic goods, and apparel witnessed high-single-digit growth. Overall, Costco is proving its expertise by avoiding price hikes and attracting customers to its wholesale offerings. Is COST Stock a Buy? Analysts remain divided on Costco's long-term stock trajectory due to the uncertainty surrounding tariffs. On TipRanks, COST stock has a Moderate Buy consensus rating based on 17 Buys and seven Hold ratings. Also, the average Costco Wholesale price target of $1,077 implies 6.8% upside potential from current levels. Year-to-date, COST stock has gained 10.2%. Please note that these ratings were given before Costco's Q3 print and are subject to change once analysts revisit their views on the stock. See more COST analyst ratings
Daily Mail
2 days ago
- Business
- Daily Mail
Costco follows in footsteps of rival to speed up checkout
Shoppers largely love shopping at Costco. Until they have to leave. For years, members heaped praise on the grocer's low prices and generous return policy — it's consistently ranked among the best grocery stores in consumer ratings. But shoppers continue to groan about the long checkout lines. That may change with a new tech rollout. Costco's CEO, Ron Vachris, confirmed in the company's Thursday earnings call that it's working on a scan-and-go style feature to save time. 'We found that digital really enhances the speed of checkout, and so we are really working hard on the digital membership card usage,' he said on the company's earnings call. 'We've also engaged in some scan-and-go, done by Costco.' The CEO's tech tease sounds a lot like what Sam's Club has been doing for years Business Insider reported. Instead of waiting in line at the registers, Costco is hoping the tech launch will let customers scan barcodes with their phones while walking through the store. Then, when shoppers have picked up all of their products, they can show the full list of products in their cart to a team member stationed near the exits. The Costco employee would approve the mobile transaction after verifying the items in the shopping cart match the scanned barcodes. Sam's Club shoppers started using early iterations of the technology all the way back in 2013. The company, which is owned by Walmart, has added continual tech updates to the quick scanning tool. In 2021, the brand added a Scan & Ship feature that lets shoppers tap into delivery models for larger products. Shoppers can also access a wider array of products through the feature, including trims and colors that are available at nearby warehouses and stores. 'I freaking love scan and go,' one happy Sam's Club shopper said in a Reddit post. 'I rarely have to do more than say "thanks you have a nice day, too," as I leave.' It comes as Costco has been on a hot sales streak. The company just reported a net income of $1.90 billion over the past three months, an 8 percent increase over last year. The same period in 2024 netted $1.68 billion. Costco has been working to build out its scale throughout the US: it announced plans to open 29 new American warehouses in 2025. This comes despite the brand's now-higher membership fees. In September, Vachris announced that Costco was increasing annual fees for the first time in seven years. But to shoppers, the one-time increase hasn't impacted their love for the brand. Costco has been cutting prices on several essential products, like olive oil, butter, and car fuel, to keep its good will. Still, the company is facing some headwinds. On the Thursday earnings call, Costco's executives said the brand is facing pressure as President Donald Trump continues to raise the potential of increased tariffs.
Yahoo
3 days ago
- Business
- Yahoo
Costco takes a page from rival Sam's Club to speed up checkout in its warehouses with ‘Scan & Pay'
Costco is testing a feature that would allow customers to scan items in its warehouses and pay for them on their phones, following the lead of Walmart-owned rival Sam's Club. CEO Ron Vachris offered few details on the technology, but a guide on Costco's website said customers will receive a QR code after paying that they scan at a kiosk before exiting. Costco is turning to technology to get its customers out the door faster, a feature first pioneered by rival Sam's Club. On the company's fiscal third-quarter earnings call, CEO Ron Vachris said the company has been quietly testing technology that would allow customers to use their phones to scan items and pay, bypassing checkout lines and improving the speed at which customers can complete their purchases. 'We've also engaged in some 'Scan & Go done by Costco' kind of tests that we're doing out there that have been extremely successful of moving people through the lines and expediting the transactions,' Vachris said on the earnings call. 'We've seen some very, very early results that have been very positive and great adoption from our members—seeing that as well.' The name 'Scan & Go' is trademarked by Walmart-owned rival Sam's Club, which has been developing this type of checkout technology for years. An early version of the tech, which launched in 2013, allowed customers to scan their items in the app but required them to pay in the self-checkout lane. Later, Sam's Club allowed customers to pay for scanned items in the app, and is now looking to replace self-checkout lanes across the U.S. with the tech. Costco CEO Vachris offered few details about its version of the technology, but a guide on the Costco website explains its 'Scan & Pay' technology, offered in partnership with Instacart, is similar to that of Sam's Club. By scanning items' barcodes, customers build up a digital shopping cart which they can then pay for directly in the app and receive a QR code to scan at a 'Scan & Pay' kiosk before exiting. Costco did not immediately respond to Fortune's request for comment. Customers have long complained about the warehouse club's lackluster digital services and the fact it doesn't offer the scanning technology Sam's Club has developed for more than a decade. Now, Costco is apparently embracing the idea with 'several new technology pilots,' Vachris said. More than half of Costco members have downloaded the company's app, and chief financial officer Gary Millerchip sees the company's foray into 'Scan & Pay' tech as a growth area for the company. 'We still think there's plenty of opportunity to keep driving higher penetration of digital engagement with our members and we think it's got a runway to continue to grow in the future,' Millerchip said on the earnings call. This story was originally featured on Sign in to access your portfolio
Wall Street Journal
3 days ago
- Business
- Wall Street Journal
Costco to Rely on Advancing Orders, Production Shifts to Offset Tariffs
Costco Wholesale COST 3.67%increase; green up pointing triangle is taking steps to reduce its exposure to tariffs by pulling orders forward and moving the sourcing of its private-label products to the regions where they are sold. These actions have helped lower costs for the warehouse-club chain, while also enabling it to avoid sharp price increases for consumers, Chief Executive Ron Vachris said on a call with analysts Thursday.
Business Insider
3 days ago
- Business
- Business Insider
Costco Counters Tariffs with Strategic Sourcing and Bulk Orders
Membership-only retailer Costco Wholesale (COST) reported its third quarter fiscal 2025 results yesterday, marginally outpacing expectations for both earnings and sales. The company said that consumers are pre-ordering goods and making bulk purchases in anticipation of future tariffs. This has helped the retailer to avoid raising prices and maintain its 'competitive price position.' Confident Investing Starts Here: CEO Ron Vachris noted that, 'We're watching pricing daily, if not hourly, on every key commodity.' Notably, 8% of Costco's goods sold in the U.S. are imported from China, with nearly one-third coming from other countries. Consumers have already stocked up on many summer goods such as patio furniture and sporting equipment, helping Costco to maintain stable prices on them. Here's How Costco Is Mitigating Tariff Impact In the post earnings call, the company noted that it has pulled forward shipments of certain goods to mitigate the potential impact of tariffs this summer. Costco is also re-routing goods sourced from countries facing heavy tariff burdens to its non-U.S. markets. Effectively, it is importing goods into the U.S. from those countries with minimal tariffs. It has also been able to lower prices on essential items like eggs, butter, and olive oil. Costco is also working on shifting production of goods to countries with lower tariffs. Meanwhile, its private-label goods, which offer better value for money, are being preferred over more expensive goods. This, coupled with bulk purchases by customers, has helped Costco deliver solid comparable sales and exceed expectations. Costco has previously stated that raising prices of its products would be a 'last resort,' and the company is living up to that promise, while peers Walmart (WMT) and Target (TGT) are struggling to strategize effectively. Costco saw high-single-digit same-store sales in the fresh food category and double-digit growth in meat. Plus, discretionary items such as jewelry, home furnishings, small electronic goods, and apparel witnessed high-single-digit growth. Overall, Costco is proving its expertise by avoiding price hikes and attracting customers to its wholesale offerings. Is COST Stock a Buy? Analysts remain divided on Costco's long-term stock trajectory due to the uncertainty surrounding tariffs. On TipRanks, COST stock has a Moderate Buy consensus rating based on 17 Buys and seven Hold ratings. Also, the average Costco Wholesale price target of $1,077 implies 6.8% upside potential from current levels. Year-to-date, COST stock has gained 10.2%. Please note that these ratings were given before Costco's Q3 print and are subject to change once analysts revisit their views on the stock.
