Big Boxes, Bigger Strategy: The Analytics Behind Costco’s Location Strategy

Photo by Grant Beirute on Unsplash

Costco, the much beloved big box retailer, operates ~582 stores in the United States.

We pulled the data on these stores to learn where their footprint is today, the characteristics of the areas surrounding the stores, and what the information says about their market strategy.

Nationwide Footprint

Costco’s footprint spans most of the United States. We overlaid a 20-minute drive time radius on their 582 locations to understand their coverage. We found that:

• The brand concentrates primarily in and around large urban-suburban markets
• Central-to-Southern California, the NYC-DMV corridor, and Chicago have very high store concentration
• Most locations grow outward from a major market; few are in isolated locations

20-minute drive radius for Costco locations in the contiguous US

Given that the brand is more of a “destination” shopping experience, we used a 20-minute driving radius as a catchment area for the length of time a customer would travel to reach them.