Costco is reinstating some purchase limits on toilet paper, cleaning supplies, bottled water and other “key items” due to higher demand as well as shipping delays caused in part by a trucker shortage, CFO Richard Galanti said.
It’s a different situation from that seen at the start of the pandemic, when Costco and other retailers ran out of sanitary products due to a spike in demand amid mass stockpiling, Galanti said Thursday evening on a conference call with analysts to discuss the company’s fiscal fourth-quarter results.
“A year ago there was a shortage of merchandise,” he said. “Now, [suppliers] have got plenty of merchandise but there’s two- or three-week delays on getting it delivered because there’s a limit on short-term changes to trucking and delivery needs of the suppliers, so it really is all over the board.”
“So planning is crucial … we’re putting some limitations on key items, like bath tissues, roll towels, Kirkland Signature water, high-demand cleaning-related SKUs related to the uptick in Delta-related demand,” he added.
Galanti did not say exactly how many of each item customers would be able to buy.
The company’s placing orders of goods earlier to try to cope with the delays, Galanti said, adding that the company has chartered three ocean vessels for the next year to secure its ability to import goods from Asia amid record shipping traffic.
The company has recently warned customers that they could face delays of some products, including toilet paper.
They also announced strong earnings Thursday, with quarterly revenue up 17 percent year-over-year to $62.68 billion, topping analysts’ expectations.
Costco reported earnings of $3.76 per share for the quarter, up 23.7 percent from a year earlier — even as the company warned of rising costs cutting into profit margins.
Shares were up about 0.5 percent to $455 per share in premarket trading Friday.