Costco Korea starts selling online

The American membership-only warehouse club Costco Wholesale Korea has opened its online shopping mall this week.

It is the first among the Asian countries Costco has entered, and its fifth international online shopping site after the US, England, Canada and Mexico.

Customers who are Costco Korea members who register online can shop online at the store.

The products sold are categorised under 11 different groups: digital, home electronics; furniture, home interior, toys, Christmas; sports, fitness; garden, patio; clothing, fashion accessories; jewellery, watches, accessories; beauty, health; tools, living, cars; stationery, office supplies; and food.

Compared to other online malls which don’t have a paid membership, the number of items offered is much lower. All prices include shipping.

Costco has chosen to abstain from selling fresh food online. This could be interpreted as an acknowledgement that the company currently doesn’t have a distribution system fast enough to assure the freshness of the products. For now, customers will be able to purchase processed foods, grains, dried foods, and snacks.

Industry observers say that since Costco’s online mall lacks fresh food, and has a lot of foreign brands among the products it carries, its pool of consumers should not overlap with domestic retailers.

Furthermore, the fact that only customers with current membership can use the online mall is another limitation of Costco’s internet penetration potential.

However, based on the success Costco has achieved through its domestic offline stores, some observers are predicting that once Costco expands its logistics infrastructure, increasing the number of products it can handle and distribute through the online site, its influence on the domestic online market could be great.

Costco already ranks No.1 in consumer satisfaction among the five largest hypermarket retailers in Korea (Emart, Homeplus, Lotte Mart, NH Hanaro Mart, Costco), according to a report from the Korea Consumer Agency.