Costco's first outlet in China opened on Tuesday and was soon overrun with customers willing to fight over discounted products and wait hours to pay for their purchases.
The American retail giant had to suspend operations in its Shanghai store in the afternoon citing "heavy traffic and customer flows," according to a text message sent by the company to consumers holding its membership card. The message was shared on Weibo, China's micro-blogging website.
The frenzy at Costco’s store comes at a time when the US and China are locked in a tit-for-tat tariff war that shows no signs of abating and is making American firms wary of investing in the largest Asian economy. Costco is also entering a market where many of its global rivals have struggled and given up. Carrefour sold an 80 per cent stake in its China unit at a discount in June while German wholesaler Metro is looking to sell its operations.
Costco’s shares rose 5 per cent to a record high in the US on Tuesday. The stock has climbed 44 per cent this year.
‘Crazy’
“There’s no other word to describe Shanghai’s Costco but crazy,” said a Weibo user, who gave up on the shopping plan after seeing two-hour queues at the checkout counters. Other Weibo users shared that they had to wait three hours to enter the parking lot while some decided to walk to the store to avoid the traffic jam.
Other pictures showed customers grabbing packets of roast chicken and elbowing out other shoppers at the store. Local news reports said the retailer offered discounts as deep as 60 per cent on some products and annual membership for just 199 yuan (€25). The sale also includes the nation’s coveted fiery liquor drink from Kweichow Moutai and Wuliangye Yibin.
Costco didn’t immediately answer phone calls and an online inquiry seeking comments on Tuesday’s shopping frenzy. – Bloomberg
