How Costco Quietly Built Its Billion-Dollar Clothing Business in 2025

Costco, long known for bulk groceries and household goods, has quietly transformed itself into a major force in fashion retail. Over the past several years, the retailer’s apparel division has exploded, shifting perceptions of what Costco can be beyond its warehouse model. In its fiscal 2025 results, Costco reported that its men’s apparel sales were up by double digits. Analysts indicate that from 2019 to 2024, the company grew its annual clothing revenue from about $7 billion to nearly $9.7 billion — a sharp 40% increase. This growth outpaced competitors like BJ’s Wholesale Club and Sam’s, which posted garment growth of 28% and 21% respectively. So, how did Costco pull this off? 🔍 The “Treasure-Hunt” Strategy Part of Costco’s advantage lies in its surprise-and-delight approach. Rather than offering the same items month after month, Costco refreshes its clothing inventory frequently. Customers never quite know what they’ll find — and that unpredictability drives visits and impulse buys. The retailer carries its own Kirkland Signature brand alongside well-known labels like Levi’s, Gap, and Columbia. Costco negotiates direct licensing deals and scoops up overstock or surplus product lines when available, creating limited-time deals that feel exclusive. 🧩 Branding, Customer Trust & Aggressive Deals Costco has also taken cues from top-tier fashion brands. Its internal brand, Kirkland, sometimes mirrors popular designs or performance standards seen in larger labels, further boosting consumer confidence. Because shoppers associate Costco with quality and value, its forays into clothing carry less brand risk. By combining strategic deals, smart branding, and the mystery of limited offerings, Costco has evolved from a bulk retailer to a fashion destination — one where you can buy a winter jacket, a pair of jeans, and your groceries in one trip.