Northern Trust announced its selection by Costco Wholesale Corporation to deliver custody, daily valuation, and brokerage services for Costco's defined contribution retirement plan, which holds $29 billion in assets. In the asset owner segment, the objective is to enable clients, such as Costco, to enhance investment returns, ultimately allowing them to better serve their constituents. The service delivery is expected to elevate the retail giant's retirement plan management for its employees.
Northern Trust's new client, Costco has a rich history of growth and expansion in the retail industry. Costco, a membership warehouse club with over 800 locations focuses on delivering quality brand-name merchandise, specialty departments and exclusive services to its members. Originating in 1976 as Price Club, the first location in San Diego initially served small businesses but expanded to non-business members marking the beginning of the warehouse club industry's growth. In 1983, the first Costco warehouse opened in Seattle and the company became the first to achieve $3 billion in sales in less than six years according to the Costco Company Information website provided by Costco.
The evolution of this warehouse club through strategic mergers boosted not only its name recognition but also significantly increased its annual sales. After merging with Price Club in 1993 operating as PriceCostco, the company's annual sales reached $16 billion with 206 locations. Costco's operating philosophy centers on cost efficiency large membership and buying power to provide members with best prices. Since reverting back to the Costco name in 1997, the company's global growth has resulted in total sales exceeding $192 billion in recent fiscal years. Costco warehouses carry about 4,000 SKUs (stock-keeping units) compared to 30,000 found at most supermarkets according to the Costco Company Information website provided by Costco.
The relationship between Costco and Northern Trust is a partnership founded on mutual respect and recognition. "We are honored to be selected as asset servicing partner for Costco’s defined contribution plan," said Melanie Pickett, Northern Trust Head of Asset Owners, Americas, according to a press release by Northern Trust. "Our success in the defined contribution plan space is testament to our years of experience innovative solutions and high level of commitment to our clients’ needs. We look forward to providing outstanding client service to Costco."