Industry Threats & Opportunities
- Improving disposable incomes and corporate profit will aid industry growth
- Consumers are more likely to seek out gasoline from industry operators when oil prices are high
- Rising corporate profit will allow businesses to spend more on industry-retailed goods... purchase to read more
Industry Analysis & Industry Trends
Due to the low-cost, high-value products they offer, operators in the Warehouse Clubs and Supercenters industry typically performs well regardless of the macroeconomic climate; however, when businesses and consumers have deeper pockets, they are likely to spend more at industry establishments. Despite overall industry growth, steep declines in the world price of crude oil have kept revenue gains slow over the period. Many industry operators retail fuel at establishment-run gas stations; therefore, as the world price of crude oil declined over the five years to 2016, the industry was forced to lower gasoline prices, which stifled revenue growth. Over the next five years, industry revenue will rise in line with the growing economy and recovering oil prices.
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Industry Report - Starting a New Business Chapter
The industry has a high level of concentration with the top four players expected to account for an estimated 93.6% of market share in 2016; therefore, prospective operators planning to enter this industry will encounter high barriers to entry in the form of competition from existing operators. The dominance of players fluctuates by region; as such, the barriers for a potential industry entrant vary depending on where it plans to launch stores.
Construction and development costs for a full-size (i.e. 112,000 square feet or lager) store range from $5.0 million to $8.0 million. Land acquisition costs for a club generally range from $3.0 million to $5.0 million, but can be significantly higher in some locations.
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Additional Insights for the
Warehouse Clubs & Supercenters
IBISWorld identifies 250 Key Success Factors for a business.The most important for the Warehouse Clubs & Supercenters Industry are Having a loyal customer base Ability to control stock on hand Having a wide and expanding product range
IBISWorld analysts also discuss how external factors such as Corporate profit and Per capita disposable income in the Warehouse Clubs & Supercenters industry impact industry performance... purchase to read more