Costco’s Record-Breaking Year: A Look Back at the Warehouse Giant’s 2021
Costco is ending 2021 on top. Despite the effects of supply chain issues and inflation, the warehouse club’s shares reached an all-time high on Nov. 29. And it’s been an overall big year for the retailer — it has raised its minimum wage twice, formed a new partnership with Uber and reported double-digit growth in sales.
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Here’s a look back at Costco’s big 2021.
February: Costco Raises Its Minimum Wage to $16 an Hour
In late February, Costco CEO W. Craig Jelinek announced that the warehouse retailer would be raising its starting wage to $16 an hour, NPR reported.
“I want to note this isn’t altruism,” Jelinek said during a Senate Budget Committee hearing. “At Costco, we know that paying employees good wages […] makes sense for our business and constitutes a significant competitive advantage for us. It helps us in the long run by minimizing turnover and maximizing employee productivity.”
June: Costco Reopens Food Courts
During the pandemic, Costco had halted the distribution of most free samples and closed seating at its food courts, but returned to full sampling and reopened seating in June, USA Today reported.
July: Costco Teams Up With Uber for Same-Day Delivery
On July 21, Costco and Uber announced that they had entered a delivery pilot program at 25 locations across the state of Texas. The partnership would allow Costco members to have their groceries delivered “within hours, if not minutes,” with Uber and Uber Eats.
September: Costco Raises Prices Due To Inflation
Due to increased freight costs, higher labor costs, rising demand for transportation and products, higher commodity prices, and shortages in computer chips, oils and chemicals, Costco was forced to raise prices on some of its products, Costco’s chief financial officer Richard Galanti said during a conference call, according to CNBC.
“We can’t hold on to all those [extra costs],” Galanti said. “Some of that has to be passed on, and it is being passed on. We’re pragmatic about it.”
Galanti said at the time that inflation was likely to run between 3.5% and 4.5% broadly for Costco.
September: Costco Reinstates Limits on Toilet Paper and Cleaning Supplies
During a September earnings call, Galanti announced that the company would be putting “limitations on key items” such as toilet paper, bottled water and cleaning supplies so it can meet any increase in demand due to the COVID-19 surge caused by the delta variant, NPR reported.
October: Costco Raises Its Minimum Wage to $17 an Hour
In an effort to retain and attract new workers amid the Great Resignation, Costco raised its minimum wage for the second time this year, from $16 to $17, NPR reported.
October: Costco Reports Double-Digit Sales Growth
Over the month of October, Costco’s net sales grew 19.2% to $16.47 billion, up from $13.82 billion the previous year, Supermarket News reported. Gas — spurred by the surge in fuel prices — and food court sales were the top performers.
November: Costco Shares Reach an All-Time High
On Nov. 29, Costco shares reached an all-time high of $554.88 before falling slightly. The following day, Telsey raised its price target on Costco to $600 from $540 ahead of the warehouse retailer’s November sales report, which was expected to be “solid,” Seeking Alpha reported.
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