Costco rolls out two grocery delivery services to fight growing competition from Amazon and Wal-Mart. Fred Katayama reports.
Costco says it rolled out two grocery delivery services this week. One is a free two-day delivery of dry groceries nationwide for online orders over $75. The other is same-day delivery of fresh foods and other groceries from roughly half of Costco's U.S. stores. With the new delivery services, Costco is trying to fight competition from Wal-Mart and the growing threat from Amazon. Moody's Charlie O'Shea says grocery delivery is developing into an arms race. (SOUNDBITE) CHARLES O'SHEA, VP - SENIOR CREDIT OFFICER, MOODY'S INVESTORS SERVICE, INC (ENGLISH) SAYING: "It's necessary to have it because you want to satisfy your customer. And if your customer wants something in this retail environment, you should find a way to give it to them. But I don't know if this is the big game changer in the sector that maybe a lot of folks think." Costco also reported a decline in quarterly gross margins. That pushed down the company's shares Friday.