Costco Limits Toilet Paper Purchases as Shortages Make an Unwelcome Return

A customer at a Giant store reaches for one of the last packages of toilet paper, which became scarce after many people emptied stores in a panic in March 2020.

Chip Somodevilla/Getty Images

shoppers just can’t get enough toilet paper.

In an earnings call Thursday evening, the warehouse chain said it would begin to limit purchases of toilet paper, Kirkland signature water bottles, paper towels and cleaning supplies in response to a surge in demand fueled by the spread of the Covid-19 Delta variant.

The new restrictions harken back to the early stages of the Covid-19 pandemic in March 2020, when grocery stores around the nation struggled to keep essentials in stock as panicked buyers stockpiled supplies.

Costco (ticker: COST) shoppers have complained about toilet paper shortages in some stores, taking to Twitter to vent their frustration. Other shoppers tweeted that some stores already were limiting toilet roll purchases.

A Twitter user with the handle Counselor Lewis, @ahmadtlewis3, said: “What is wrong with people? Did we not learn from last year at all? I pulled up to Costco and they are out of toilet paper and water.”

Costco said it was dealing with nagging supply chain delays and inflationary pressures.

“The factors pressuring supply chains and inflation include port delays, container shortages, Covid disruptions, shortages on various components, raw materials, and ingredients, labor cost pressures, and trucks and driver shortages,” said Executive Vice President Richard Galanti on the call.

Galanti estimated that the overall price inflation of Costco’s products was in the 3.5% to 4.5% range. Pulp and paper goods prices were up between 4% and 8%. Prices of some plastic products like Ziploc bags, plastic cups, pet products and trash bags were up in the 5% to 11% range.

Commodities such as oil, coffee and nuts remained at five-year highs, and fresh foods were up by mid- to high-single digits, Galanti said.

Despite the supply chain strains, Costco stock was rising after the company beat analysts’ earnings expectations in its fiscal fourth quarter. Costco reported earnings of $3.76 a share on sales of $62.7 billion. Analysts had projected Costco would earn $3.58 a share on sales of $61.4 billion.

The stock was up 0.6% in premarket trading Friday to $455.49 a share.

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