Even with the tough economic environment, Costco's traffic has continued to grow consistently on an annual basis. Analysts believe it's benefiting from its membership model.
Numerous retail executives have continually reiterated how tough economic conditions continue to strain consumer budgets, leading to dampened discretionary spending and prompting companies to cut prices just to drive in-store and online traffic. However, recent data from Placer.ai shows Costco had a boost in visits during the first quarter, with traffic up 8.9% year over year. In February, visits were up 10.9%. Over the next two months, visits were up 10.5% and 9.
" However, the analysts noted that foot traffic at the membership warehouse grew an average of 5% during various economic conditions, both when consumers were flush with cash from the pandemic and when the "macro backdrop took a step down" in 2023. Even today, although the macro "has remained volatile" so far this year with "consumer budgets stretched," the company increased its traffic an average of 5% year to date, according to UBS analysts.
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