Costco (COST), One Of Retail’s Last Hopes, Falters
December 4, 2008 by Douglas A. McIntyre
The retailers who were supposed to do OK during the recession were the ones with the really, really good goods which were being sold at the really, really low prices.
Wal-Mart (WMT) falls into that bucket. So did Costco (COST), until today. Costco’s same-store sales had looked fairly good over the last few months.
That ended.
Costco reported net sales of $5.55 billion for the month of November, a decrease of 3% from $5.72 billion in the same four-week period last year. Same-store sales in the US were actually not too bad, down 3%. But, overseas the number fell 15%, bringing the company-wide total to a 5% drop.
The announcement is a fairly good indication that even retailers with an unusually good blend of price and quality are seeing sales undermined by weak consumer spending.
Costco and Wal-Mart were the last best hopes for retail. Now, there is only one.
Douglas A. McIntyre
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