Costco Wholesale Announces To Open Outlet In France
The wholesale company has finally announced after a month that it will be launching outlet in France.
Costco Wholesale Corporation had been pondering over the idea of opening its outlet in France as said by the head of operations of the wholesale company earlier in August. On September 30, 2015, the company has finally announced that it will be launching its services in France, according to what the company told Wall Street.
The head of International Operations stated that before disclosing any details of the expansion plan it had to make sure that it has something firm to discuss. The chief financial officer of Costco, Richard Galanti said on a conference call while talking about the earnings of the company that it had planned to open a warehouse in Paris suburb of Villebon-sur-Yvette and further informed that by the fall of the next fiscal year (which will be August 2016) it will have the opening of the warehouse.
By the fiscal year 2016, Costco Company plans to expand its business by adding 32 extra warehouses in its portfolio. According to the company, out of these warehouses about 10-12 warehouses will be opened abroad including the French location. The company will also be opening warehouses in Madrid, Spain. The CFO also informed that the Western European market is a tough market to get into because of the rules and regulations and the permitting process as well. However, the warehouse club is very interested in continuing the process.
For the future, the company plans on doubling its warehouses in Taiwan and South Korea as there are already about 12 locations in these places where Costco already exists. Canada has over 80 Costco warehouses while Australia which has less than two third of Canada’s population has only seven locations where Costco is present. Richard stated that the company does not plan to have as many warehouses in Australia as Canada but it will like to add a few soon. As for outlets present in Canada, the company said that it never thought it would plan to have more than 80 in the country but now it has expanded and has more than 80 over the span of one year, it will certainly add more.
The Executive of the company predicts that in the next five years, half of all the new outlets that will be opened will be in the international markets. Since these countries have many challenges, it becomes difficult to open warehouses abroad. He further said that it takes time to get to know a market and would eventually learn business. Success comes slowly and requires patience according to the CEO of the company.