Costco CFO Richard Galanti said Thursday the company wants to make sure it has essential items in stores, even as shipping delays and truck driver shortages make it difficult to keep them. on the shelves. goes.
On a call for results, he said the retailer was “putting in something.” [purchase] Limits on key elements. These include toilet paper, paper towels, bottled water, and popular cleaning supplies. He did not specify how much of each item customers could purchase.
The product line is in demand for a different reason than in the early stages of the pandemic, when stores saw unusually high demand for paper products and antibacterial wipes as customers stocked up on these items.
“A year ago there was a shortage of goods,” Galanti said. “Now they have a lot of shipments, but there is a two or three week delay in delivery because there is a limit to the short term changes in the trucking and supplier delivery needs, so this is really general. “
The subscription-only warehouse chain beat analysts’ expectations Thursday for the fiscal fourth quarter, which ended on August 29. Yet like other retailers, Galanti said the pandemic has strained Costco’s supply chain and increased its costs.
Galanti said Costco pre-orders on what it needs. He said the company has hired three seagoing vessels for the next year to transport containers between Asia and the United States and Canada. Each ship can carry 800 to 1,000 containers at a time, he added.
In early August, there were a few social media posts about product limits for some of its private label products. This week, the retailer warned some customers they could experience delays when ordering toilet paper online – a household item that means storage. This delay was first reported by Fox Business, which mentioned it in a purchase order confirmation email.
Galanti said Thursday that demand for jewelry, home goods, drugstores and sporting goods has been strong over the past three months. He added that the retailer – known to be large and heavy – “has sold rings in the order of $ 100,000”.
Costco shares rose less than 1% Thursday night. At the close of the market, the stock has gained 20% this year, bringing its market cap to $ 200.16 billion.