albert Chan
BJ’s Wholesale Club
Sector: Food, drug and mass retailers Country of operation: The US Key product categories: Food and beverages, fuel, general merchandise, health and beauty, and pharmacy Annual Metrics [caption id="attachment_151625" align="aligncenter" width="700"]
Fiscal year ends close to January 31 of the following calendar year*Trailing 12 months ended April 30, 2022[/caption] Summary Founded in 1984 and headquartered in Westborough, Massachusetts, BJ’s Wholesale Club operates membership warehouse clubs, primarily in the Eastern US. The company provides general merchandise, groceries and perishables, with private-label products sold under the brands Berkley Jensen and Wellsley Farms. The company offers two types of memberships: Inner Circle and Business. As of April 30, 2022, the company has more than 6 million members and operates 229 clubs and 160 gas stations in 17 states. Company Analysis Coresight Research insight: The combination of a comprehensive cold-chain supply chain and a well-focused omnichannel capability means that BJ’s Wholesale Club has been well positioned to meet consumer needs since the beginning of the pandemic: Since fiscal 2019 (ended January 31, 2020), BJ’s membership grew 15% and groceries now represents 75% of BJ’s merchandise sales. Indeed, fiscal 2021 (ended January 31, 2022) was the best year in the company’s history—it reported $880 million in adjusted EBITDA and $361 million in membership fees. Additionally, digitally generated sales surpassed $1 billion for the first time, which is 8% of total revenues—about 80% of these sales are fulfilled in-store through its “buy online, pick up in store” (BOPIS) offering, curbside pickup or same-day delivery. Starting in 2022, BJ’s began experimenting with new same-day delivery methods in the Eastern US, where it has partnered with DoorDash to provide on-demand delivery of groceries to members and non-members. The retailer has also launched Same Day Select, a subscription-based service for members in the region. During fiscal 2022, the company expects the upswing to continue, with 6.5 million members in sight by the end of the second quarter. Significantly, the company has diversified membership types and benefits to improve renewal rates, which already hover at around 90%. In addition, BJ’s Wholesale Club has begun to branch out from suburbia into urban centers, with a new store format, BJ’s Market. The new format, about three-quarters of the average size of regular BJ’s club, is aimed at urban professionals and workers who need to make quick purchases, while benefiting from BJ’s affordable prices.
| Tailwinds | Headwinds |
|
|
- Grow its membership base through traditional and digital sales
- Maintain high renewal rates with the diversification of membership categories and partnerships with financial institutions
- Develop and offer a compelling product assortment responsive to customer preferences
- Retain price competitiveness through scale and efficiency
- Ramp up digital offerings to offer increased convenience to customers
- Develop a new store format to further facilitate digital offerings and sales
- Open new clubs and gas stations in both new and existing markets
Company Developments
| Date | Development |
| June 10, 2022 | BJ’s announces its next wave of new club openings. |
| April 29, 2022 | BJ’s opens the first store of its new format, BJ’s Market. |
| March 30, 2022 | BJ’s launches subscription-based same-day delivery for members in the Eastern . |
| March 28, 2022 | BJ’s partners with DoorDash to offer members and non-members access to BJ’s grocery lineups in the Eastern US. |
| March 3, 2022 | BJ’s tests a new store format, BJ’s Market in Warwick, Rhode Island. |
| January 25, 2022 | BJ’s agrees to acquire four distribution centers from Burris Logistics. |
| January 7, 2022 | BJ’s opens a new club in Commack, New York. |
| December 10, 2021 | BJ’s opens a new club in South Fayette, Pennsylvania. |
| October 25, 2021 | BJ’s announces that Rachael Vegas has been appointed Executive Vice President, Chief Merchandising Officer, effective October 25, 2021. |
| June 2, 2021 | BJ’s announces that Darryl Brown has joined its Board of Directors, effective immediately. |
| May 20, 2021 | BJ’s expands its footprint and announces plans to open six new clubs in fiscal year 2022. |
| July , 2020 | BJ’s announces that Monica Schwartz will join the company as Chief Digital Officer, effective August 3, 2020—she will help the company scale its digital business and launch new offerings |
| July 22, 2020 | BJ’s announces that it will open two new club locations in New York in early 2021, bringing the company’s total store count to 221. |
| July 9, 2020 | BJ’s announces that it will open one new location in Chesterfield, Michigan, on July 31, 2020. |
| August 22, 2019 | BJ’s announces that it will open two new clubs in 2020, one each in Chesterfield, Michigan, and Pensacola, Florida. |
| June 5, 2019 | BJ’s announces the opening of two new clubs with gas stations in Michigan, one in Madison Heights and the other in Taylor, in fall 2019. |
- Christopher Baldwin—Executive Chairman
- Robert W. Eddy—President, CEO and Director
- Laura L. Felice—CFO
- Scott Kessler—Chief Information Officer
Source: Company reports