Core Insights - Costco has successfully established itself in the Chinese market over the past six years, leveraging its unique membership model and high-quality product offerings to enhance consumer shopping experiences [1][12] - The company has expanded its store presence to seven locations across six cities in mainland China, demonstrating a strong growth trajectory since its first store opening in Shanghai [4][12] Expansion Strategy - The first Costco store in mainland China opened in Shanghai on August 27, 2019, with a shopping area of nearly 14,000 square meters and over 1,000 parking spaces, attracting significant customer traffic [2] - Following the successful launch, Costco opened its first store in Shenzhen in January 2024, achieving a remarkable membership registration of 140,000 prior to the opening [2][4] Operational Excellence - Costco's expansion in China is supported by precise site selection and refined operational strategies, resulting in a solid foundation for growth [4] - The company has introduced unique services, such as the first Costco member-only gas station in Nanjing, which offers self-service fueling at discounted prices [4] Global Sourcing and Pricing Strategy - Costco employs a global sourcing strategy that ensures popular international products are available in China, while also providing opportunities for local products to reach global markets [5] - The company maintains a strict gross margin cap of 14% on all products, ensuring competitive pricing through a robust global procurement system and partnerships with leading manufacturers [5] Enhanced Member Services - In response to the growing demand for efficient online shopping, Costco launched a home delivery service in 2024, offering same-day delivery within 90 minutes in select cities [6] - The online platform features a wide range of products, including food, personal care, electronics, and large appliances, allowing members to enjoy a seamless shopping experience [6] Private Label Strategy - Costco has maintained a high standard for supplier management, offering around 4,000 carefully selected global products while adapting its offerings to local consumer preferences [7] - The company has localized some of its private label products, such as Kirkland Signature, to reduce costs while ensuring quality comparable to mainstream brands [7] Commitment to Sustainability - Costco emphasizes sustainable practices, such as reducing plastic use in packaging and offering products certified by international organizations for environmental responsibility [10] - The company’s products, including Kirkland kitchen paper and seafood, adhere to sustainability certifications, ensuring traceability and environmental stewardship [10][12] Future Outlook - China is a key market for Costco, and the company aims to continue expanding its store footprint while enhancing member value through a combination of global procurement and local innovation [12] - The company plans to deepen its market trust through a sustainable product strategy and an integrated online-offline shopping experience [12]