Costco ups metro NYC count, other clubs are close behind - Costco Wholesale Corp. opens new warehouse store in the New York, New York suburb of Lawrence

Discount Store News, Sept 6, 1993 by Arthur Markowitz

KIRKLAND, Wash. -- Costco Wholesale opened a 150,000-sq.-ft. club in the New York City suburb of Lawrence last month as part of a major thrust into the metro New York market that calls for about six more stores.

The Lawrence club, one of Costco's largest units, is part of the company's 17-unit expansion in 12 states and Canadian provinces that will see nine stores opened by the end of this month, with the other eight to be unveiled by the end of the year.

Costco is using the additional footage in Lawrence for a number of tests: * Wider aisles to service a heavy traffic flow that is expected to generate about $150 million in sales. The extra 30,000 sq. ft. also allows Costco to merchandise goods in full-pallet displays, rather that doubling up two related items on a display pallet; * An expanded 5,000-sq.-ft. home office section that displays about a dozen working personal computers on tables and an expanded software offering; * Merchandising apparel on tables and double-tier racks set at an angle to the main aisles. This allows all the goods on the racks to be seen by shoppers, giving better exposure than the hanging endcap; * Presentation of more furniture on flats to show customers what the fully assembled items look like.

The Lawrence club, in Nassau County on Long Island, is Costco's third in the metro New York market. The region is becoming a highly contested area for clubs as both Pace Membership Warehouse and BJ's Wholesale Club plan to open more stores in the area and Sam's Club gets set to make its debut.

Costco expected the Lawrence club to be among its highest volume units because of a location that will draw members from the immediate vicinity of middle-income homeowners as well as from small businesses and consumers in New York City's boroughs of Queens and Brooklyn, which are adjacent top the Long Island community.

Costco has metro area clubs in Clifton, N.J., and Nanuet, (Rockland County) N.Y., and has applied for planning approval for sites in Long Island in Commack (adjacent to a Home Depot home center) and Woodmere, with negotiations underway for other locations.

Costco's proposed merger with Price Club could further strengthen its market stance. Price Club has four clubs on Long Island: Coplague, Smithtown, and Holbrook (Suffolk County) and Westbury (Nassau County), as well as one in Wayne, N.J.

Wal-Mart plans to enter the Long Island market next year with a discount store and Sam's Club in Westbury. Pace, meanwhile, has clubs in Elmsford (Westchester County), N.Y., and Paramus, N.J., with another due to open this month in Jersey City, N.J.

BJ's has clubs in East Farmingdale (Nassau County), N.Y., and Secaucus, N.J.

In its 17-club expansion, Costco has opened clubs in Prince George, British Columbia, Canada; Twin Falls, Idaho; Warrenton and Bend, Ore.; Wharton, N.J.; Clarkston and Sequin, Wash.; and Colchester, Vt., the latter a new state for the company.

The Twin Falls and Warrenton clubs are also Costeo tests (see DSN, May 17, page 2). The former 150,000-sq.-ft. unit includes a test DIY home center department, while the latter 75,000-sq.-ft. unit probes the concept of a scale-back club for small markets.

Costco is scheduled to open stores in: Waterbury, Conn., and Waltham, Mass., in October; in Vista, Livermore and San Diego, Calif., and Honolulu, in November; and in Lethbridge, Alberta, Canada and Merced, Calif., in December.

Costco will also move its Northeast Regional Operations and buying office in October to the Waltham club.