ISSAQUAH, Wash. -- Opening a net of 20 to 22 warehouses, completing a remodeling and retrofitting program and building on a new Executive Membership program are the top goals for Costco Cos. here in 1999, according to the company's annual report.
"During fiscal 1999, it will be incumbent upon us to complete the rollout of the Executive Membership program to the remaining seven-plus million members and, perhaps more important, to effectively communicate to our members the dramatic savings that can be achieved from each and every service being offered," said Jim Sinegal, president and chief executive officer.
The company mailed introductory Executive Membership offers to approximately half of its 16 million regular member households, including all members in Arizona, California, Colorado, Maryland, Oregon, Virginia and Washington. The added services of the new program include long-distance telephone and business-printing services and employee health care.
Also in the report, Sinegal said Costco plans to open new warehouses in Taiwan and Japan as well as in the United States and Canada.
Costco opened 17 new warehouses in fiscal 1998, including six outside the United States. Five openings, in the Detroit area, "were the result of an opportunistic real-estate purchase," Sinegal said.
The company now has 285 warehouse stores in operation, including 16 in Mexico.
Sinegal said "In terms of new warehouse expansion, we are excited about our entry into several new markets in fiscal 1999, including the Chicago market, where we opened two new warehouses in mid-November. We will announce other new markets as our plans become firm."
During fiscal 1999, which began in September, the company plans to "upgrade a number of our older facilities to include expanded fresh foods and ancillary departments -- including expanded food courts, pharmacy and optical departments and our very popular gas stations," he added.
During the first quarter of fiscal 1999, Costco launched a new on-line shopping service that offers more than 400 products.
At the end of fiscal 1998, the company reported net sales of $23.8 billion, an 11% increase, and a 47% increase in net earnings, from $312.2 million in 1997 to 1998's $459.8 million.
