Core Insights - Costco is expanding its product offerings beyond traditional supermarket staples, increasingly focusing on "big and bulky" items such as furniture and saunas, which has contributed to its sales growth [2][3][12] E-commerce Growth - E-commerce sales reached nearly $20 billion in the most recent fiscal year, marking an increase of over 15%, and now account for more than 7% of Costco's annual net sales [6] - The majority of big and bulky sales are conducted online, indicating significant growth potential in this segment [5][8] Strategic Shift - Costco's shift towards larger, higher-margin items is a strategic response to market conditions, aiming to shield itself from volatility in lower-margin categories [14] - The company is targeting a more affluent customer base, appealing to consumers who appreciate value without necessarily needing to save money [15] Market Positioning - The introduction of larger items in stores is seen as an opportunity to attract new customers who may not have previously considered Costco for home furnishings or high-end products [9][12] - Costco's evolving brand perception is supported by a high percentage of visitor loyalty and an adaptable merchandising model [12] Seasonal Strategy - The upcoming holiday season will see Costco stocking categories that have not been traditionally offered, such as backyard sheds and saunas, reflecting the success of the big and bulky item trend [18][19] Competitive Landscape - Costco's expansion into larger items is prompting competition among major retailers like Amazon and Walmart, as they also seek to capture the big and bulky market [17]