BJ’s Pledges to Expand Its Fresh Food Business

BJ’s Wholesale Club is making significant strides in the grocery market, with impressive gains in both unit sales and dollars during its third quarter, which ended on November 2. A major driver of this success has been the company’s focus on fresh food, particularly as it continues to roll out its Fresh 2.0 initiative, which has already shown promising results.

Fresh 2.0: A Key Growth Strategy

The Fresh 2.0 program was built upon insights from BJ’s own data, which showed that members who make BJ’s their primary destination for fresh food visit the retailer at least once a week and have basket sizes nearly 30% larger than those who don’t regularly shop for fresh items. These fresh-focused shoppers also spend about eight times more annually than those who don’t prioritize fresh foods, and are more likely to be higher-tier members. As Robert W. Eddy, BJ’s President and CEO, explained, the initiative is designed to expand these behaviors to a broader base of members.

Investments in Fresh Products

To reinforce its fresh food business, BJ’s has made several key investments, including enhancing its produce assortment and expanding vendor relationships to ensure greater availability and seasonal variety. The company also completed the rollout of stand-alone cooler stations at store entrances to highlight its quality offerings and create a more inviting shopping experience for fresh food.

Additionally, BJ’s has invested in fresh food training across its locations, ensuring employees can effectively promote and handle fresh products.

Strong Results and Growth in Perishables

These efforts have paid off, with perishables driving strong comparable sales growth in the third quarter. Produce alone saw double-digit growth, with the majority of this increase coming from higher unit volumes. The company’s Net Promoter Score for fresh items has also dramatically improved over the past two quarters, signaling better customer satisfaction.

Other Impressive Q3 Results

BJ’s Q3 results were bolstered by a 1.5% year-over-year increase in comparable-club sales (excluding gasoline sales, which rose by 3.8%). The company also saw a 30% increase in digitally enabled sales, reflecting a 47% two-year stacked growth. Membership fee income grew by 8.4% year-over-year, reaching $115 million.

Looking Ahead

With more than 240 clubs and over 180 BJ’s Gas locations across 20 states, BJ’s is continuing to expand its footprint and solidify its position as a leading warehouse retailer. As BJ’s builds on its fresh food momentum, it is well-poised to drive long-term growth by fostering customer loyalty and expanding its fresh offerings.