BJ’s Plans 1st Membership Fee Increase in 7 Years
Amid the release of BJ’s Wholesale Club’s third-quarter financial results, the retailer has revealed plans to increase its membership fee.
The price hike comes as BJ’s reaches a milestone of 7.5 million members. For the quarter ended Nov. 2, membership fee income grew by 8.4% year over year to $115.0 million.
BJ's is hoping to capitalize on its membership momentum by introducing its first membership fee increase in seven years. The fee will increase by $5 to $60 a year. The Club+ membership fee will be raised by $10 to $120 a year. The new pricing goes into effect on Jan. 1, 2025.
According to the company, the price hike allows BJ’s to invest in an even stronger value proposition for its 7.5 million member base, which continues to grow.
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BJ's also rolled out a new benefit for new and existing Club+ members, including BJ’s One+ Mastercard cardholders. Effective Jan. 1, 2025, these members will receive two free same-day deliveries on eligible orders of $50 or more during each annual membership period.
Meanwhile, BJ’s third-quarter highlights include an increase of total comparable-club sales by 1.5%. Excluding the impact of gasoline sales, comps rose by 3.8%.
Digitally enabled comparable-sales growth was 30.0%, reflecting impressive two-year stacked comp growth of 47.0%.
Gross profit rose to $975.5 million from $902.5 million in the third quarter of fiscal 2023. The merchandise gross margin rate, which excludes gasoline sales and membership fee income, increased by 20 basis points.
Selling, general and administrative expenses increased to $733.6 million in the third quarter ,compared with last year's $697.1 million.
The club retailer's net income grew to $155.7 million in the third quarter, compared with last year’s $130.5 million.
Adjusted EBITDA increased by 13.5% to $308.3 million.
Additionally, BJ's opened three new clubs and four new gas stations during its third quarter.
“Our third-quarter results demonstrate the combination of great value and strong execution. We delivered robust membership growth and hit a milestone of 7.5 million members. Our value proposition continues to resonate in new and existing markets,” said Bob Eddy, chairman and CEO of BJ’s Wholesale Club.
“As we look ahead, we remain confident in our ability to drive long-term growth and shareholder value, led by our continued focus on our strategic priorities,” added Laura Felice, EVP and CFO. “We expect fourth-quarter fiscal 2024 comparable-club sales, excluding the impact of gasoline sales, to increase 2.5% to 3.0% year over year, bringing full-year fiscal 2024 growth to between 2.3% and 2.4%. We continue to expect fiscal 2024 merchandise gross margins to remain approximately flat year over year. Finally, we expect fourth-quarter fiscal 2024 adjusted EPS to range from 78 cents to 88 cents, bringing the full-year fiscal 2024 range to $3.90 to $4.00.”
Marlborough, Mass.-based BJ’s currently operates more than 240 clubs and 180-plus BJ’s Gas locations in 20 states. The company is No. 30 on The PG 100, Progressive Grocer’s 2024 list of the top food and consumables retailers in North America.
