Costco’s Newest Move to Beat Amazon and Whole Foods? Delivery

Roughly a month after Amazon snapped up Whole Foods and slashed its prices, discount superstore giant Costco is rolling out same-day and two-day delivery options for its members.

Earlier this week, Costco rolled out a two-day delivery option for nonperishable foods and sundries items via an offering dubbed CostcoGrocery, and a second one-day delivery choice through a partnership with Instacart that includes both dry and fresh goods.

That’s according to the company’s Chief Financial Officer Richard Galanti during the company’s fourth quarter earnings call late Thursday.

Interestingly enough, as Amazon slashes Whole Foods prices, Costco’s expanded quick-delivery options also feature some lower prices than previously set on the website.

Galanti noted Thursday that those items have “significantly better pricing than even we had at for many of these items. We expect to expand these offerings over time.”

According to Galanti, CostcoGrocery, which arrives at consumers’ doors in two days or less throughout the continental U.S., offers just under 500 dry products for delivery, and free delivery for orders above $75.

The second option, delivered via Instacart, is available at some 376 Costco locations. Through that option, Costco will offer about 1,700 products.

“There’ll be a number of additional U.S. locations planned – added between now and the end of calendar 2018 as our partnership expands,” Galanti said.

Costco’s stock meanwhile trended down 4.4% in pre-market trading, after lower gross margins in the fiscal fourth quarter of 2017 flamed worries about the industry’s race to the bottom in terms of prices.

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