Costco Achieves a Record-Setting $102.87 Billion in Sales

<p>Earlier this week, Costco Wholesale Corporation reported that the company’s net sales for the 52-week fiscal year 2013 were <B>$102.87 billion</b>, a new record for the company. At over $100 billion in net sales, this could make Costco the second largest North American retailer ahead of Kroger.<hr class="legacyRuler"><hr class="legacyRuler"><hr class="invisible minimal-padding"> Although Kroger’s fiscal year 2013 has not yet ended, the company’s previous four quarters (Q2 2013, Q1 2013, Q4 2012, and Q3 2012) indicate that the company has reached $98.7 billion in net sales, just shy of reaching the $100 billion milestone so far. When comparing Costco’s previous 53-week fiscal year to its current 52-week fiscal year, the company had a 6% increase in sales from $97.06 billion. Could Costco’s price aggression be one of the main causes behind this surge in sales?<hr class="legacyRuler"><hr class="legacyRuler"><hr class="invisible minimal-padding"> According to a Q4 2013 earnings call, Costco’s Executive Vice-President and CFO, Richard A. Galanti, said that the company has always been at the forefront in maintaining low prices irrespective of the fact that underlying costs have been on the rise. “We kept our prices down when commodity – those underlying raw material costs – skyrocketed. Now that they’re coming back, it hopefully will give us a fairer margin in some of those areas where we have really hit ourselves hard, and hopefully they’re positive to margin.”<hr class="legacyRuler"><hr class="legacyRuler"><hr class="invisible minimal-padding"> Galanti continued by asserting that the company will continue being price aggressive into the future without undermining the competition. “But we’re going to keep doing what we’re doing in terms of being aggressive and I do want to say while we certainly aren’t cavalier about our competition, we think our toughest competitor is ourselves and we’re going to keep driving that.”<hr class="legacyRuler"><hr class="legacyRuler"><hr class="invisible minimal-padding"> Can Costco’s strategy continue propelling the company to the top of North American retailers?<hr class="legacyRuler"><hr class="legacyRuler"><hr class="invisible minimal-padding"> Stay tuned to AndNowUKnow for more comments and opinions. </p><hr class="legacyRuler"><hr class="invisible minimal-padding"><p><a class="btn btn-sm btn-primary col-lg-12" style="white-space: normal;" href="http://phx.corporate-ir.net/phoenix.zhtml?c=83830&amp;p=irol-irhome" target="_new"> Costco </a></p><hr class="legacyRuler"><hr class="invisible minimal-padding"><p><a class="btn btn-sm btn-primary col-lg-12" style="white-space: normal;" href="http://ir.kroger.com/phoenix.zhtml?c=106409&amp;p=irol-irhome" target="_new"> Kroger </a></p><hr class="legacyRuler"><hr class="invisible minimal-padding">