Costco has received planning approval to open its first depot in the Australian state of Queensland.
Decision signals entry into fourth state
Member club cash and carry operator Costco has been given planning to open its first depot in Brisbane. The development will see the retailer enter a new state, building on its existing coverage where it already has stores in ACT, New South Wales and Victoria. The new depot will be based at North Lakes and is expected to open sometimes in 2014, creating around 350 jobs.
New competition and retail channel
Planning was granted following a report to check that the retailer's arrival would not threaten the existence of other grocers. However, the report concluded that only 40% of Costco's range overlapped with major supermarkets and even less with smaller operators. Managing Director of Costco Australia, Patrick Noone, commented, 'Costco will bring a new element of competition and retail to the market. We’re also a trade player, so we’ll bring a new level of competition for small business and restaurants too'.
A popular proposition building scale
Costco entered Australia in 2009 and has managed to turn a profit within three years from its existing three depots. The model of having a full food and general merchandise offer under one roof, great value but also a strong quality proposition has resonated well with shoppers. Its depots in Sydney and Melbourne are amongst Costco's top performing stores globally. The new depot in Queensland will be the retailer's sixth to open in Australia with further openings in 2013 in Sydney and Melbourne.
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