The giant in warehouse industry, Costco (NASDAQ:COST) just reported its earnings of the first quarter for fiscal 2015 that bested the expectations of the analysts quite effortlessly. The profits of Costco (NASDAQ:COST) climbed 17% to $496 million and earnings per share were $1.12, which is above the consensus agreement of $1.09. The growth in same store deals was quite strong as well and an increment in profit margins growth assisted Costco (NASDAQ:COST) in developing its profit growth.

The higher SG&A costs however had a bad effect on the profit growth. The retailer’s profit margins were enhanced by 22 basis points YOY, which were backed up by solid margins in the gas business along with $17 million from pretax nonrecurring recovery of the loss. As far as the topline front is concerned, Costco (NASDAQ:COST)reported an increase of 7.4% in revenue, which was in line with the field estimates.Costco (NASDAQ:COST) has adequately leveraged its strength as a warehouse retailer.

This in turn attracts new customers and builds store activity as well. Even though the gradual client movement to web shopping has made issues for practically every retail network all over the country, it doesn’t appear to inconvenience Costco (NASDAQ:COST) much. Actually, after observing Costco (NASDAQ:COST), other warehouse clubs are now attempting to draw in clients, which is suggestive of the fact that it is not the whole warehouse business that is doing great, it is justCostco (NASDAQ:COST).

In this quarter which was the Q1 of fiscal 2015 and Q3 of 2015 for Sam’s Club, store activity at Costco (NASDAQ:COST) expanded by 4.5% YOY, determined by an ascent in the number of members and a change in renewal rates. Complete membership charges for the quarter expanded by a strong 6% to $582 million. The renewal rates were 90.7% and 87.3% in North America and worldwide respectively, while these figures remained at 90.4% and 86.5% respectively last year.

Interestingly, store movement at Sam’s Club expanded by only 0.2% in spite of the fact that it works the same plan of action. Actually, in a few ways, it has had leverage over Costco (NASDAQ:COST). It has a more extensive range and less expensive membership charges but customers still want to shop at Costco (NASDAQ:COST), which plainly shows the warehousebehemoth’s dominance in this area. The retailer depends on giving its clients great quality items at a sensible cost in a compelling environment.

Costco (NASDAQ:COST)routinely changes the brands it offers, and subsequently, clients are always discovering something new at its stores and get an experience synonymous to ‘treasure hunting’. To be more appealing, every now and then, Costco (NASDAQ:COST) offers top of the line products, such as, purses from Coach and champagne from Dom Perignon. Costco (NASDAQ:COST)additionally serves its clients based on the ongoing trends and interest in the respective neighborhoods.

It also provides its store managers with the liberty to choose some products that they think would work best for the neighborhood.

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