Costco

Lore & Background

Price Club targeted small business owners with bulk sales at no-frills outlets requiring an annual membership fee. Jim Sinegal and Jeffrey H. Costco went public in December 1985 on the NASDAQ at $10 per share, with 17 warehouses and 1,950 employees.

Reader's Guide

Costco's significance lies in its pioneering and sustained success in the membership warehouse club model, growing from zero to $3 billion in sales in under six years—a first for any company. It is the largest grocery retailer in Canada and the world's largest retailer of beef, poultry, organic produce, and wine.

Did You Know?

• The company's predecessor, Price Club, is often credited as the first to grow from $0 in sales to $3 billion in sales in under six years; Costco itself reached that milestone in about six years.

From a Family Feud to a Warehouse Empire

The warehouse club model traces back to a family dispute. In 1976, Sol Price and his son Robert launched Price Club in San Diego after falling out with the new owners of FedMart, Price's earlier membership discount store. Their first location sat inside old airplane hangars on Morena Boulevard that had once belonged to Howard Hughes. The concept was deceptively simple: sell bulk goods at steep discounts to small business owners through no-frills stores gated behind an annual membership fee. That Morena Boulevard store, designated Warehouse #401, still operates today. Seven years later, Jim Sinegal and Jeffrey Brotman opened the first Costco warehouse in Seattle on September 15, 1983. Sinegal had cut his teeth in retail as a grocery bagger under Sol Price at FedMart, while Brotman came from a Seattle retailing family and had worked in distribution. Costco initially marked up wholesale prices by only eight or nine percent, targeting small businesses. By December 1985, the company had gone public on NASDAQ at ten dollars per share, operating seventeen warehouses and employing 1,950 people.

The PriceCostco Merger and the Road Back to One Name

In 1993, Costco and Price Club agreed to merge after Price turned down a Walmart proposal to fold Price Club into Sam's Club. The two companies shared a remarkably similar business model and scale, making the combination feel almost inevitable. The merged entity, called PriceCostco, operated 206 locations generating sixteen billion dollars in annual sales, and its membership became universal—a Price Club card worked at Costco and vice versa. Leadership was initially shared between both companies' executives, but the Prices departed in 1994 to launch PriceSmart, a separate warehouse chain in Central America and the Caribbean. Costco relocated its headquarters from Kirkland to Issaquah in 1996, deliberately choosing a site adjacent to a warehouse so buyers could monitor sales and merchandise. The company had originally planned to move to Redmond, but road construction delays near the warehouse site prompted the change. In late 1996, store conversions to the Costco brand began in the Southwest, and by February 1997, PriceCostco officially reverted to the Costco name and stock symbol, with all remaining Price Club locations rebranded.

A Retail Giant Measured in Cows, Crates, and Customers

By 2025, Costco has cemented its position as the third-largest retailer on the planet, a title it held domestically as the third-largest U.S. retailer as early as 2014. The company's dominance in specific categories is staggering: as of August 2024, it is the world's largest retailer of beef, poultry, organic produce, and wine. Nearly a third of all American consumers report regularly shopping at Costco warehouses, a testament to the Kirkland Signature private-label brand and the bulk-discount model. On the corporate side, Costco ranks twelfth on the Fortune 500 list by total revenue and stands as the largest grocery retailer in Canada. As of March 2026, the chain operates 924 warehouses worldwide, with eighty-five percent concentrated in North America across the United States, Canada, and Mexico. The Kirkland Signature label itself carries a piece of corporate history, named after the Seattle suburb where the company was headquartered before moving to Issaquah.

From Airplane Hangars to Shanghai: A Global Footprint

Costco's international footprint grew steadily from its North American roots. Price Club opened a Montreal store in 1986, followed by a Mexico City location in 1992 through a joint venture with Controladora Comercial Mexicana, and the company announced plans for Spain and Portugal via its Canadian subsidiary. A bolder leap came in 2014, when Costco partnered with Alibaba Group to launch an online store on Tmall, a business-to-consumer e-commerce platform, allowing it to sell food and household items to Chinese consumers without building a single brick-and-mortar store. That digital-first entry eventually gave way to physical presence: the first Costco warehouse in China opened in Shanghai on August 27, 2019. Back in the United States, the company continued to invest in infrastructure, acquiring logistics firm Innovel for one billion dollars in March 2020. Construction of nearly all Costco buildings since 1989 has been handled by Span Construction under King Husein, and in 2016 the company announced twenty-nine new locations, its most in a single year since 2007.