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The Costco vs Sam's Club Rivalry Is Heating Up In Texas

Costco is aggressively expanding in a state that Sam's Club currently dominates.

Costco isn't afraid of a little head-to-head competition. At least that's how a top company official framed it.

During an earnings call this past spring, Costco CFO Richard Galanti firmly dismissed any suggestion that America's leading warehouse club might change the course of its ambitious expansion plans after its chief rival, Sam's Club, announced an aggressive expansion plan of its own.

"No, we're going to open where we want to open," Galanti said.

Quite to the contrary, in fact, Costco is now taking on Sam's Club on its own well-established turf—deep in the heart of Texas.

Costco Doubles Down on Expansion Plans, Membership Fees, As Sam's Club Rivalry Heats Up

Sam's Club currently operates more warehouses in Texas than any other U.S. state: 82 in total, almost double the number of its second-biggest market in Florida.

Costco, meanwhile, has just 37 stores in Texas, but that number is steadily growing.

On March 30, Costco opened its newest location in Kyle, aka the Pie Capital of Texas, a town of about 50,000, located 26 miles south of Austin. The new warehouse is less than 15 miles from the nearest Sam's Club in San Marcos.

Later this summer, Costco is scheduled to open another central Texas location in Georgetown, about 25 miles north of Austin. The 158,000-square-foot store will be similarly situated roughly 15 miles away from the closest Sam's Club in Round Rock.

Costco is also building several more stores in the Lone Star State, according to multiple reports.

Just last month, the North Texas town of Prosper announced that Costco would be moving in at the corner of FM 1385 and US 380. Local Profile reports that a groundbreaking ceremony is expected in the fall.

Prosper's northernly neighbor, Celina, has a Costco warehouse now in the works as well. The tiny town of just over 13,000 approved a deal last September to begin construction on the planned 160,000-square-foot warehouse. According to Connect CRE, it's "the smallest town ever chosen to build a full service Costco store."

Both towns are part of the fast-growing Dallas-Ft. Worth metropolitan area.

The Houston-area suburb of Tomball similarly approved a deal last November to spur the construction of a 161,131-square-foot Costco store and 10,000-square-foot fueling station. Community Impact reports the new store could open as soon as June 2024.

Meanwhile, the city manager in Corpus Christi recently told local NBC affiliate KRIS-TV that Costco had been scouting sites in his Gulf Coast city, though he added the warehouse club had made no official plans just yet.

Chris Shott
Chris Shott is the Deputy Editor covering restaurants and groceries for Eat This, Not That! Read more about Chris