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Now the World's Third-Largest Retailer, Costco Is Still Growing Its Global Presence

Costco (NASDAQ: COST) is building some interesting new warehouses in Japan and elsewhere in the world, further evidence of the retailer's path toward strong future growth. In this video clip from "Beat & Raise," recorded on Sept. 24, Fool.com contributors Brian Withers, Demitri Kalogeropoulos, and Neil Patel take a look at the warehouse retailer's presence worldwide.

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Brian Withers: This is another one that I'm just super surprised at. I guess I shouldn't be surprised that as the coronavirus abated and people started getting vaccines, they're out to Costco and spending more money. I was going to show a couple of slides, they have of Costco today presentation that has a couple of interesting little tidbits if you're not super familiar with Costco. Right in the beginning, they have a few of the, I guess these are the newest Costcos, and this is in Japan, and I don't know if you noticed there's something a little bit different about this Costco then, Demitri sees it. What's different?

Demitri Kalogeropoulos: Unless that's photoshop, I see a big parking lot on the roof. [laughs]

Withers: On the roof. Absolutely. It's on the roof, and they have the gas station here which is impressive. But I was just like, "Wow, look at all [laughs] those cars on the roof." It looks like it's a double-decker parking lot even on the top. That's pretty interesting. Certainly, the parking lot around the edges here smaller. Look at the next one. This is from a place near Nashville. You can see the huge parking lot and there's no parking on the roof. [laughs] Just a couple of more, Little Rock, Oklahoma, Springfield.

Neil Patel: Isn't Japan the country with the third most locations for them?

Withers: It has a warehouse that we'll see in a minute. But I didn't realize.

Patel: They have a lot of stores in the area.

Withers: Yeah. This didn't dawn on me either, that they're the third largest global retailer. I think that might be 12th largest retailer in the Fortune 500, I'm not sure. They may even be 12.

Patel: Yeah. It might be 12 overall actually.

Withers: A hundred billion mark.

Kalogeropoulos: It's interesting because I know they were the second largest at least for a while there. I wonder who hedged in there in second place behind Walmart, I'd have to check that.

Patel: Amazon maybe.

Withers: I'd wonder if they're counting Amazon as a retailer; 192 billion in sales, 288,000 employees. Here's the warehouses. They have 30 in Japan. So Canada, Mexico. It's likely that these are larger.

Patel: Iceland, wow. [laughs]

Withers: Iceland, pretty nice. Five hundred and sixty-four warehouses in the US, that's impressive. This must be their stores. They call them warehouses, right?

Patel: Yeah.

Withers: This number is pretty impressive to this cardholder thing. As you sign up for the executive, Demitri, you talked a little bit about the executive membership, you get I think it's now a Visa, it used to be I think a Mastercard. But you get points and you get cashback and stuff, and that's a super cool feature. Four billion in membership fee income. You talked about the 91 percent. Really pretty cool. Seems to be just doing well. I know they've worked on their online presence as well, and so that's a bigger deal.

Kalogeropoulos: That was something a lot of people were worried about for a while there too. It made sense that the bare idea that Costco's, it's pretty a big part of their competitive advantages that they have. They cover wide areas with their stores. They don't have a store within ten-minute drive of everybody. That 564, I think is compared to like a Walmart which might have over 2,000 locations in the US. You would think that might limit their ability to do quick drop two-day delivery or within 24 hours like Walmart's doing and what Target's doing. But there's no evidence that Costco is having any trouble with e-commerce compared to Target or any company that has way more stores. It's another wild factor for their logistics team.

Brian Withers has no position in any of the stocks mentioned. Demitri Kalogeropoulos owns shares of Costco Wholesale. Neil Patel has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Costco Wholesale. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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