Way back when, many years ago, when I was a HS senior, I worked as a supermarket cashier. We were told that the supermarket operated on an average margin of 1% or less (that is, average wholesale prices are about 1% less than average selling prices). I’ve read similar statistics since, so I’m assuming that what I was told was the truth, or pretty close to it.
Anyway, does anyone know what sort of margins wholesale clubs (e.g. Sam’s, BJ’s, Costco) operate on?
Just pull down the menu to “Retail - Groceries and Liquor” and enter a figure for annual revenue (you can look up the revenue for your chain, if it’s in theTop 75 chains)
You’ll get a moderately detailed breakdown of various expenses and profit, based in industry stats. Bizstats reports about a 6% net margin (gross margins are 25.6%) by this measure, but the figure I usually heard for commercial chains was 3%, give or take. Maybe they don’t count corporate overhead in retail figures, or maybe grocery stores are more profitable now than they were.
You can also look at the 2003 McKinsey study (no, not the sex survey researchers)
Silly me. I was thinking about the nearest “warehouse store” which is a grocery outlet. After I posted, I realized you might be talking about one of the more general warehouse stores, which carry clothes, books, electonics, tools, etc.
Perhaps the annual report and fact sheets for BJ’s Warehouse (a big chain here in New England) would help. I don’t know if Sam’s Club offers a similar investor site, or if it’s listed as a subcategory of Walmart’s report.