Costco Wholesale’s Longhua District store continues to thrive, with a strong membership renewal rate of 60%-70%, according to Eddie Tsao, the warehouse manager. The store’s value-driven model and curated product selection have resonated with local shoppers, sustaining high loyalty among its 140,000-150,000 members.

Expat customers are seen shopping at Costco Wholesale’s Longhua District store yesterday. Photos by Chen Xiaochun

Among its members, 5% are from Hong Kong, 60% are local residents of Longhua District, and fewer than 5% come from nearby cities such as Guangzhou and Dongguan.

With an annual membership fee of 299 yuan (US$41.7), Tsao emphasized that customers can easily recoup the cost within just five shopping trips. Costco’s strict pricing policy ensures no product exceeds a 14% gross margin, aligning with its mission to deliver “good products and services at reasonable prices.”

The Shenzhen store stocks over 4,000 products, including around 30% imported goods — from South Korean seaweed to Spanish olive oil — all rigorously tested to meet global standards. Costco’s famed Kirkland Signature brand, produced in collaboration with top-tier manufacturers, spans food, apparel, household items, and entertainment products.

Eddie Tsao, warehouse manager of Costco's Longhua District store, presents a Kirkland Signature-brand tissue product.

“When a product sells well in one market, we introduce it worldwide,” Tsao noted, citing Chinese Wogan oranges now sold in Canadian stores as an example. “Our global supply chain lets members access the best from 14 regions and over 900 warehouses.”

Hong Kong members favor snacks, dried foods, cosmetics, and health supplements, with an average spend of 750-800 yuan per trip. In comparison, Shenzhen locals typically spend 650-700 yuan.

Customers are seen shopping at Costco Wholesale’s Longhua District store.

“In Shenzhen, our primary customer base consists of smaller households and a mobile population. This demographic profile naturally leads to lower average transaction values per visit, as these customers have less capacity for bulk purchases. While this represents the key spending difference, we've observed that product preferences remain remarkably consistent across China's consumer markets,” Tsao observed.

According to Tsao, Costco remains committed to the Chinese mainland growth, with staff training underway for future store openings. “We’re ready to scale,” Tsao affirmed, underscoring the chain’s strategy to replicate its hybrid global-local model.

A scene of the Costco store.

The Costco store in Longhua District is the U.S.-based bulk-buy retailer's first store in South China. It was opened Jan. 12, last year. This membership-only, four-story big-box warehouse club spans a total construction area of 44,500 square meters, with a shopping area covering 15,000 square meters.

Costco opened its first outlet on the Chinese mainland in Shanghai’s Minhang District in 2019. The Shenzhen warehouse is the sixth Costco outlet on the mainland. Currently there are seven outlets on the mainland.