Costco starts UK warehouse 26

Date : 21 January 2014

Press reports have revealed that warehouse club operator Costco has begun construction work on its 26th site in the UK. The new warehouse, projected for completion in the late summer is located in Hounslow, close to Heathrow, west London.  

Strengthens Greater London presence

This will be the fourth Costco within the M25 (and with Thurrock sitting just outside), and it is understood that the company is still targeting two more sites. The business has averaged just over one opening a year since it launched in the market just over 20 years ago.

Further boost to international openings

While remaining heavily weighted to the US market in overall scale, where over 70% of its sites can be found, 2013/14 has seen a  step up in warehouse openings in Costco's international markets.  Of the 36 openings planned for this financial year, up to 18 will be completed in Asia, Europe, Canada or Australia, with the latter seeing as many a five new warehouses added. The new Hounslow site may be open just too late to be included in 2013/14, which runs to the end of August.

But mixed outlooks for new markets

As has been widely reported, Costco is also targeting two new market entries in Europe.  Work on its first Spanish warehouse, in Seville, is well advanced, with the opening scheduled for March. Meanwhile a second site, in Madrid (where Costco Spain has its headquarters) is likely to follow quickly. However, the liberalisation of development in Spain is providing a notable contrast with the challenges Costco is facing in France.

Second permission refusal in France

Having been refused permission to develop its first named site in France, Costco has now also been refused on the second, Villebon-sur-Yvette.  With majority approval needed at both national and local levels, Costco's proposal narrowly missed gaining the necessary support within the local authority in L'Essonne department. Costco is aiming to open its first French warehouse in 2015, but this latest disappointment could put that timescale in jeopardy.