Costco is planning to open at least 30 new warehouse locations every year for the next decade, a growth push that spans the United States and reaches deep into international markets from Mexico to Spain to Australia. The retailer's top executives laid out the strategy during the company's second-quarter earnings call, describing a real estate pipeline they say stretches five to ten years into the future.
The plan amounts to roughly 300 new stores over the next decade, a bet that American consumers and their counterparts abroad still want more bulk savings, not less. At a time when many retailers are trimming footprints and chasing e-commerce, Costco is doubling down on the physical warehouse model that built it.
CFO Gary Millerchip told analysts the company sees a clear roadmap ahead. Fox Business reported his remarks from the earnings call:
"We tend to look five to 10 years out in terms of our real estate plans, and we would still see a really good roadmap for 30-plus warehouses a year, which is the goal that we have at least achieving 30 new warehouses a year. The goal that we set for ourselves."
That number, 30-plus, is not a ceiling. It is the floor Costco's leadership has set for itself.
Millerchip broke down the geographic split. Around half, or slightly more, of the new warehouses will land in the United States. The rest will go to Canada, Mexico, Europe, Asia, and Australia. Spain was singled out as one target for the company's aggressive international push.
The domestic half of the strategy is notable for where it is heading. CEO Ron Vachris acknowledged that the classic suburban Costco footprint, a 25-acre parcel with a massive warehouse and acres of parking, does not fit every market the company wants to enter.
"If we want to get into some of these inner cities, you're not going to find 25 acres available for us to go into. So how can we infill in some of these very strong markets, like Los Angeles, New York, different places, with a unique model for Costco that is going to allow us to continue to expand?"
That question signals a shift. Costco built its brand on wide-open warehouse boxes in the suburbs. Now it is exploring smaller or differently configured stores to crack dense urban cores where land is scarce and expensive. The details of that "unique model" remain unclear, but the intent is plain: go where the customers already live, even if it means rethinking the template.
One driver of the expansion is a problem most retailers would envy. Many existing Costco warehouses are packed. Former CFO Ron Galanti has noted that numerous locations exceed $300 million to $400 million in annual sales, staggering volume for a single store. That kind of traffic means crowded aisles, jammed parking lots, and long checkout lines.
For members who have experienced the Saturday afternoon crush at their local Costco, the company's growth plan carries a practical promise: shorter lines, better parking, and easier access to the bulk deals that keep people renewing their memberships year after year. Whether Costco or its competitors deliver more savings to families is a perennial debate, but the retailer's membership renewal rates suggest shoppers have already made up their minds.
Costco is not just building new boxes, either. Vachris said the company is simultaneously relocating existing stores and upgrading the interiors of older warehouses.
"We're not only expanding buildings, we're relocating and we're also upgrading the insides of a lot of our older warehouses too. So we continue to put the money back into the company to drive top-line sales and grow our business globally."
Part of that strategy involves refurbishing structures that previously housed other businesses, including former home improvement stores and international grocers. The approach keeps costs lower than ground-up construction and gets stores open faster.
One concrete example of the expansion already taking shape sits in Port St. Lucie, Florida. The city is selling land for a new 170,000-square-foot Costco warehouse and gas station at a price of $6 million. It is the kind of deal that illustrates how local governments often welcome the retailer, and the jobs and tax revenue it brings, with open arms.
Port St. Lucie is hardly an inner-city infill project. It is classic Costco territory: growing suburban population, room to build, and a customer base hungry for value. But it shows the company is moving into new markets even as it rethinks its approach for tighter urban settings. Members in those new locations will want to understand the retailer's membership policies before they start loading up their carts.
The warehouse expansion does not exist in a vacuum. Costco has been making parallel moves to improve the shopping experience for its most loyal customers. The company recently rolled out exclusive early shopping hours for executive members at U.S. warehouses, the New York Post reported. Executive members can now shop from 9 to 10 a.m. on weekdays and Sundays, and from 9 to 9:30 a.m. on Saturdays, before regular members are admitted.
Ancillary departments, food courts, optical centers, and pharmacies, participate in the early hours, though pharmacies stay closed on Sundays. Vachris told analysts the company continues to pursue ways to "improve the member experience" and urged them to watch for new technology pilots aimed at speeding up the checkout process.
That checkout focus matters. Anyone who has stood in a Costco line snaking past the televisions knows the bottleneck is real. The company has already been adjusting its self-checkout approach, with employees taking over scanning duties in some locations. Faster front-end technology could ease the pain further, especially as new warehouses bring in even more members.
When asked about competitive pressure from other warehouse and discount operators, Millerchip offered a telling answer. He said Costco focuses on being "our own toughest competitor" and finding ways to lower prices and deliver more value. He added that the company sees no meaningful impact on its membership base from rival operators in any market.
That is a confident posture, and one the numbers seem to support. Stores doing north of $300 million a year are not losing customers to the competition. The challenge for Costco is not market share. It is capacity. The existing footprint cannot absorb the demand, and the expansion plan is designed to fix that.
For shoppers who have figured out every trick to save time at the register, more stores closer to home would be the biggest quality-of-life improvement Costco could offer.
The expansion plan raises questions Costco has not yet answered publicly. The company did not disclose how many warehouses it currently operates, making it harder to gauge what a 30-store annual increase means in percentage terms. The timeline for the inner-city "unique model" stores is vague. And while Millerchip described the geographic split, he did not name specific new U.S. cities beyond Port St. Lucie or identify which European and Asian markets are next.
The cost of the decade-long build-out also went unaddressed. Land deals like the $6 million Port St. Lucie transaction offer a data point, but a 170,000-square-foot warehouse with a gas station in suburban Florida costs far less than whatever Costco will need to spend to plant a flag in Manhattan or central Los Angeles.
Investors and members alike will want to see whether the company can maintain its famously lean operating model while scaling at this pace. Growth for its own sake has sunk plenty of retailers. Costco's track record suggests discipline, but 300-plus new stores is a different magnitude of commitment.
In a retail landscape littered with closures, bankruptcies, and shrinkflation gimmicks, Costco is doing something unusual: growing by giving customers more of what they want, at prices they are willing to pay, in physical stores they actually enjoy visiting. No government mandate. No subsidy program. Just a company reading demand and building to meet it.
That is how the market is supposed to work. When a business earns loyalty by delivering value, expansion follows naturally. Washington could learn something from a company whose hardest problem is that too many people want to shop there.