It is being reported that Costco has doubled down on Hawaii shopping in particular. This is of importance to both visitors and residents. So when you show up next to shop at the big-box retailer, you should expect to find more fully stocked shelves. Keep in mind that it is guesstimated that up to 1/3 of all Costo Hawaii shopping is that of our visitors.
The reason that this so resonates with us who live here, and may with you as Hawaii visitors, is that we are incredibly reliant on shipping here just to be able to go to the store. Last week there was some issue again with Hawaii barge monopolist Young Bros, which immediately sent store shelves to near empty, for example.
London shipping analysts at Braemar ACM, said that Costco, together with their Hawaii shipping partner, Pasha Hawaii, has just outbid all other companies to secure multiple ships from the market last week. In doing so the prices being set are all-time highs. Read on for what that might mean to us.
Putting this in perspective, one ship alone, will cost the company $42K per day during its three-year contract. It is believed that in total, seven ships have been leased by Costco.
Hawaii retailers, in particular, are subject to issues of shipping vulnerability, and that is seen frequently in terms of empty store shelves. Costco announced last year that they already charted three boats and this now expands their Hawaii shipping presence with boats that are two to four times larger than those previously leased.
Global chartering and shipbroking specialists Braemar ACM said, “The current market dynamic is expected to last well into 2022 and possibly the full year.”
As a result, the largest retailers are turning to expensive, extreme measures such as this. Home Depot, Target, and Walmart are also chartering ships.
Costco said that while chartering is expensive, it provides “some amount of our total that we control.”
What isn’t clear is how much this new expense is going to cause prices to rise at Costco. Nor how this will hurt smaller Hawaii retailers in their able to compete with the big chains.