Background: Costco, the US warehouse-style retailer founded in 1983, is famous for its bulk-buy bargains, membership model, and random product range: from TVs to diamonds to 400-roll toilet paper packs. Since opening its first Australian store in Melbourne back in 2009, Costco has racked up more than $30 billion in local sales.

What happened: Fresh ATO tax data shows that Aldi and Costco together pulled in a combined $17.5 billion in Aussie sales for FY24. Aldi led the charge with $12.5 billion, while Costco brought in just over $5 billion for the year.

What else: To put that into perspective, Coles reported $39 billion in sales for 2024. While Aldi and Costco aren’t quite there yet, they’re closing in fast. And with both challengers coming hard for Aussie customers, Coles and Woolies are being pushed to stay sharp on pricing to keep their dominance.

What's the key learning?

💡Competition keeps everyone honest. For years, Coles and Woolworths ruled Aussie grocery shopping with little real challenge, until global discount giants like Aldi and Costco entered the scene... forcing them to re-think pricing and value.

💡Woolies has had a rough run. Its share price has dropped 44% over the past few years, as competition and shifting consumer behaviour have put pressure on them. But the fightback is on - and it's good for consumers.

💡Since mid-2023, Coles and Woolies have narrowed their price gap with Aldi by nearly 30% across staples like chicken, mince, milk, and frozen pizza. So as competition fires up, prices often come down.