HONG KONG – Shoppers in the southern Chinese city of Shenzhen recently flocked to the new Costco store, marking the US retailer’s latest outlet on Chinese shores. This comes more than four years after the opening of Costco’s first store in China, which caused quite a sensation. The new 44,500-square-meter store in Shenzhen, often referred to as China’s “Silicon Valley,” drew large crowds in search of bargains and imported products. With its strategic location along the southern coast of China, Shenzhen is home to tech giants like Tencent and DJI, as well as a rapidly growing middle class.
This is Costco’s sixth store in the world’s second-largest economy, but its first venture in the southern coastal region. Shenzhen, with a population of over 17 million and a 2022 GDP of $460 billion, according to local government data, provides a lucrative market for Costco. During the store’s opening, discounted fruits, such as cherries and berries, as well as the Chinese spirit Moutai, were among the most sought-after products.
The demand was so high that many shoppers waited in line for over an hour to enter the store. Images shared on Chinese social media depict customers filling every aisle of the 15,000-square-meter shopping space, with their trolleys fully loaded. The giant version of Pixar’s Lots-O’-Huggin’ Bear was also in high demand. Additionally, customers praised Costco’s selection of imported brands that are not easily found elsewhere in China.
However, Costco faces intense competition in China’s retail market, particularly from online shopping platforms like Taobao and Pinduoduo, which have become popular among Chinese consumers. It also competes with other US brands such as Sam’s Club, owned by Walmart, which already has four branches in Shenzhen.
When Costco opened its first store in Shanghai in 2019, it had to shut down early on its first day due to overwhelming crowds. The chaotic scenes included hours-long queues, people crawling under shop gates, and even scuffles over shopping bags and rotisserie chickens. Since then, Costco has expanded in China, mainly near Shanghai, where there are currently two stores.
In conclusion, Costco’s new store opening in Shenzhen attracted a large number of shoppers eager to explore the US retailer’s offerings. With the demand for imported products and the presence of a growing middle class in China, Costco aims to capitalize on this market. However, it faces strong competition from online shopping platforms and other US brands. Despite these challenges, Costco remains determined to establish a presence in China’s booming retail industry.