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Retail Marketing

Consumers swarm Costco's first store in China on opening day, forcing it to close early

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By Shawn Lim, Reporter, Asia Pacific

August 28, 2019 | 3 min read

American retail giant Costco had to close its first store in China ahead of its official closing time on opening day because of safety concerns after shoppers swarmed the store.

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The roads leading up to the store also saw massive jams, forcing the police to close certain roads.

The new store in Shanghai became packed with shoppers pushing their carts soon after the store opened at 8.30am on Tuesday, according to Inkstone.

The roads leading up to the store also saw massive jams, forcing the police to close certain roads.

The retailer, which charges a membership fee and offers bulky brand-name products at low prices, wants to target affluent consumers in China. It charges an annual fee of 299 yuan (US $42) in the country.

While it may seem Costco's entry into China has been well received, it has to compete with the likes of Alibaba and JD.com, which have opened omnichannel supermarkets like Hema.

Foreign retailers have experienced mixed results in China. French supermarket chain Carrefour sold 80% of its China operations after years of loss-making, while Amazon closed its China shopping platform that connected domestic sellers and buyers to focus on selling imported products.

However, the likes of Walmart is planning to expand Sam’s Club, which functions similarly to Costco, to 40 stores from the current 26 in China by 2020.

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