• Joann said it has reached a deal to sell its assets and wind down operations.
• Earlier this month, the company planned to close around 500 stores.
• The fabric and crafts chain experienced two rounds of Chapter 11 bankruptcy in less than a year.

Joann has reached the end of its thread.

The fabric and crafts chain said Sunday that it has reached a deal to sell its assets and wind down operations, including closing around 300 remaining stores.

"We deeply appreciate our dedicated Team Members, our customers and communities across the nation for their unwavering support for more than 80 years," the company said in a statement.

Earlier this month, the company planned to close around 500 stores as it navigated its second round of Chapter 11 bankruptcy in less than a year.

Eight in 10 Joann shoppers surveyed earlier this month by Numerator said they were upset about the news that some of the chain's stores were closing.

Numerator said that three-quarters of those said they were most likely to shop at Michael's or Hobby Lobby as an alternative, about half said they'd shop online, and nearly 40% said they'd go to large stores like Walmart or Target.

The news follows a rough start to the year for retailers, including Party City and Big Lots, which said they are closing 700 and 480 stores, respectively. A Business Insider tally finds more than 2,500 locations are set to close this year so far.

• Walmart issued a conservative outlook for the year ahead in its latest earnings report.
• However, the company shared three key numbers that highlight how the company is growing.
• The retail giant has transformed itself over the years amid competition from rivals like Amazon and Target.

If you think you know Walmart, think again.

While investors weren't too thrilled when Walmart reported a conservative outlook during its fourth-quarter earnings this week, the company shared three key numbers that underscore just how much the company has grown in recent years.

Here's how the retail giant is transforming itself to take on rivals like Amazon and Target.

$681 billion in annual sales

That's the total sales last year — more than any other company in the world, including Amazon.

Perhaps more interestingly, Walmart's full-year revenue has grown by more than $121 billion over the last four years and is greater than the $107.5 billion Target has made in revenue over the past year.

In other words, Walmart has effectively grown by more than one whole Target since the pandemic, which is no small feat, nor is it sitting still when it comes to finding new sources of revenue.

There are signs, however, that Walmart could lose its crown. Amazon, for the first time, notched a stronger fourth quarter revenue and is projected to take the lead in sales this year as it leans harder into AI and web services, CNBC reported.

30% of Walmart's online shoppers pay to not wait

The company said nearly a third of e-commerce shoppers pay a fee to get delivery within a one- or three-hour window on items like groceries and pharmacy prescriptions.

Last year, that number was zero, since it was only introduced in March.

Walmart's ability to achieve this ultrafast same-day service is driven largely by its fleet of more than 4,600 US stores, which are within a short drive of 93% of US households.

"If I could change anything about how we're perceived today, it would be that more people know about our breadth of assortment online and are increasing delivery speed," CEO Doug McMillon said on the earnings call Thursday.

4 million developer hours

Walmart said its AI-enabled coding assistants and completion tools saved developers approximately 4 million hours last year.

Again, that number was nearly zero a year ago.

It's just one among several ways the 63-year-old retailer is morphing into a formidable 21st-century technology company, with an expanding e-commerce marketplace, growing advertising business, and an increasingly automated supply chain.

"As we become more productive and reduce the amount of time we work on routine tasks that gives us time to develop tools that help us grow the business and move faster," McMillon said.

With Amazon nipping at its heels, the Walmart of 2025 is fast becoming much more than your grandad's Superstore.

• Florida's pension board has sued Target over its DEI practices.
• The complaint argues that Target misled investors about the impact of backlash to its Pride collection.
• The suit blames Target's stock price troubles on DEI, rather than other business challenges.

The state of Florida has joined the growing legal challenges against Target.

The State Board of Administration of Florida, an agency that oversees public pension funds that own Target stock, has sued the retailer, arguing it misled investors about the impact of backlash to its Pride campaign and DEI initiatives.

Florida argues Target's handling of its 2023 LGBTQ Pride collection was uniquely harmful to shareholders.

"The Campaign provoked immense consumer backlash and boycotts that caused Target's sales to fall for the first time in six years and wiped out over $25 billion in Target's market capitalization—leading Target's stock to experience its longest losing streak in 23 years," the complaint says.

Target did not immediately respond to Business Insider's request for comment.

The proposed class action lawsuit is related to an earlier shareholder lawsuit filed in August 2023 against Target, as well as one filed last month by the City of Riviera Beach police pension fund. All three lawsuits were filed in federal court in Ft. Meyers.

Target executives did say during an August 2023 earnings call that traffic and top-line trends were affected by backlash to its Pride collection, but added that "it's not possible to reliably quantify the separate impact."

The company has also recently struggled to compete for inflation-weary consumers against larger rivals like Walmart and Amazon, among other business challenges.

Target may be facing the reverse backlash as well, as numerous employees and customers have told Business Insider they no longer support Target after they feel it has caved to anti-DEI pressure.

Last month, Target said it was retiring several DEI initiatives to remain "in step with the evolving external landscape."

Many other retailers have similarly been retooling their approach to DEI following President Donald Trump's executive order announcing the termination of these practices in the federal government.

The January 22 order directs all government departments and agencies to "take strong action to end private sector DEI discrimination."

• January visits to club stores are up 7% from last year — double the increases for Walmart and Target.
• The strong start accelerates 2024's trend as buying in bulk gets more popular.
• US shoppers are increasingly looking for the best deals and great experiences at warehouse stores.

The hottest club in town might be your local warehouse store.

January visits to Costco, Sam's Club, and BJ's were up more than 7% from last year, according to foot traffic data from Placer.ai. That's double the increases for Walmart and Target.

"It's a continuation of 2024," Kantar retail analyst Gina Logan told Business Insider.

Club store visits significantly outpaced those of Target and Walmart in each of the prior six months, according to Placer.ai's data, with the warehouse chains seeing big gains for the full year of 2024 compared to 2023.

Logan said that while inflation likely drove a lot of that bulk-buying popularity, several other forces have entered the chat this year, including weather, tariffs, and bird flu.

"The same kind of logic applies to the retailers front-loading, and I think that people are stocking up in advance as well," she said. "Costco and Sam's and BJ's are where you're going to get the lowest price per unit."

Not only are the prices often the best in town, warehouse chains also boast some of the best experiences, according to shoppers — and they're getting better.

Costco has long been the gold standard in terms of customer satisfaction across retail, but this year Sam's Club managed to snatch the top spot in the annual American Consumer Satisfaction Index rankings.

"They're really looking into things that will draw people to come to the club," Logan said, highlighting Costco's treasure hunt and new jumbo cookie, BJ's success in fresh foods and grocery, and Sam's Club's tech-enabled member experience.

At the same time, Logan said shoppers are increasingly looking to make the most of their annual membership fee — which has gotten more expensive — and choosing clubs more frequently than the monthly stock-up.

"They're becoming more of a routine and becoming more ingrained in people's shopping routines than before," she said.

The traffic gains are translating to respectable sales growth as well, according to an analysis from Morgan Stanley's retail team. Club stores saw 6.8% monthly sales growth in January, slightly ahead of off-price retailers and behind the dollar store and athleisure categories.

What makes the estimated top-line gains even more notable is that the club stores have been working to bring prices down, which means they have to sell even more stuff to beat the prior period's inflation-boosted numbers.

Official quarterly and annual results will begin to come in on Thursday when Walmart reports earnings for Sam's Club, while BJ's and Costco report in two weeks.

The numbers suggest that club stores are giving customers a strong bang for their buck, and the foot-traffic data shows customers are coming back more often.

• Vermont's Butterfly Bakery is about as hyperlocal as it gets, with all ingredients from nearby farms.
• Still, CEO Claire Georges tells BI her business is still affected by global trade policy.
• She recently tried to get ahead of tariffs by buying extra glass bottles and found storage was a headache.

This as-told-to essay is based on a conversation with Claire Georges, CEO of Butterfly Bakery, a seed-to-shelf natural foods producer in Vermont. The interview has been edited for length and clarity.

I started Butterfly Bakery in 2003 as a tiny natural foods bakery with just me baking in the middle of the night while I had a full time job.

For the last 10 years, we've been selling hot sauce made with locally sourced ingredients.

We even started developing a really great relationship with Heatonist, who went on to manage "Hot Ones" and their sauces. Then the pandemic happened, and hot sauce just really exploded.

Now hot sauce is the majority of what we do.

80% of our ingredients by weight are sourced directly from small farms. The ingredients that aren't are things like vinegar and salt.

We call it seed to shelf.

We're about as local as a business can get, but we still operate and live in this global society and global marketplace. We get our heating fuel from Canada, and a majority of our glass comes from China.

There are two primary manufacturers of our main five-ounce hot sauce bottle: one in China and one in New Jersey.

When I first heard that there was a New Jersey option, I was like, "Oh, fantastic! That fits in with everything we do in terms of sourcing."

It's more expensive, but so are our chili peppers.

We started buying them, and, unfortunately, the quality was really awful. Part of the issue was that they would explode in my staff's hands. They were not tempered properly, so when we would fill it with something hot, the glass would explode.

It would make a huge mess and the entire production had to stop to make sure there's no glass getting in the product. We'd have to throw out sauce that was nearby and start over again.

Not only was that really frustrating, but these US bottles were about 10 to 20 cents more expensive, which is a lot when you're talking about Chinese ones that cost about 35 cents each.

We now use the bottles from China, and back in November we did a whole truckload so that we could stock up to get ahead of any new tariffs.

Fitting in that truckload was an adventure. We were moving things out of every nook and cranny, and everybody just got really cozy with all the glass bottles for a little while, until we got through most of them.

It quickly became clear that if these tariffs were going to last four years, we definitely can't buy four years' worth of worth of glass because there's nowhere to put it.

We've been in business for 20 years now, and you just kind of take your lumps, keep going, and figure it out.

I'm paying about 35 cents for a bottle, and that's varied widely. A 10% tariff means I pay about three to four cents more.

That doesn't sound like a lot on a $9 bottle of hot sauce, but we're usually buying up to $30,000 worth of glass at a time. Now that $30,000 order becomes a $33,000 order — what else as a business could we do with that $3,000?

More than the tariffs on Chinese goods, I'm most apprehensive about potentially higher costs of fuel from Canada.

We're paying between $4,000 and $6,000 in fuel costs for heating and running our equipment, so that's an extra $400 to $600 every single month that we would need to pay.

During the pandemic, I felt like government leaders were trying to help small businesses out. These tariffs feel like the opposite of that.

I don't think tariffs as a whole are bad. I think they just need to have a reason and a benefit.

I am committed to local for the good that it does, but I'm not an isolationist.

For example, there was a store near here that attempted to survive for a couple of years, and they were hyper-hyperlocal — literally everything had to either be made locally or grown locally, with no exceptions.

What it meant was that their deli sandwiches had no mayonnaise on them, because nobody made mayonnaise locally — mayonnaise has oil in it, and nobody was locally growing oil crops.

As a result, nobody wanted to buy the sandwiches, because people want mayonnaise on their sandwiches.

In other words, even local businesses can still benefit from the global economy.

I don't think closing out other people benefits anybody.

• As America's grocery king, Walmart sources a high share of its products from within the US.
• Target, by contrast, relies more on merchandise that is often imported, such as apparel and housewares.
• The difference puts more of Target's business at risk from Trump's promised tariffs.

For all their similarities, Walmart and Target have key distinctions that could spell big differences in how each could be affected by rising import costs as President Donald Trump introduces new tariffs.

In a recent research note, Truist Securities analyst Scot Ciccarelli said Walmart is better positioned to deal with new tariffs than Target, especially since inflation-weary shoppers are likely to be more sensitive to price hikes.

While some of the new tariff costs could be passed on to customers via higher prices, Ciccarelli said retailers are more likely to put pressure on their vendors to absorb some of the pressure.

As the largest retailer in the world, Walmart has shown itself to be particularly effective at negotiating favorable deals from its suppliers.

And if retailers do wind up raising prices, that could tilt in Walmart's favor.

"Higher costs via tariffs would likely further accelerate the consumer search for 'deep value,' and further increase the wallet share for top value providers, including Walmart," Ciccarelli said.

The differences go beyond the price tags. Where a product comes from is increasingly important in the new trade landscape.

"Target is actually much more exposed than Walmart because Walmart is grocery-heavy and groceries are predominantly domestic," Jason Miller, supply chain professor at Michigan State University, told Business Insider.

As America's grocery king, Walmart US makes nearly 60% of its revenue from the grocery category and only about a quarter of sales from general merchandise.

In addition, grocery as a share of sales has been increasing in recent years as the general merchandise share has declined, according to Walmart's annual report.

Target, by contrast, relies much more heavily on merchandise that is often imported, such as apparel, housewares, and beauty. Food and beverage sales accounted for less than a quarter of Target's sales last year.

TD Cowen retail analyst Oliver Chen told BI that Target's apparel segment presents another potential complication, as fashion is more sensitive to seasonality. That could make it more difficult to reschedule orders or reshuffle suppliers and still be on-time and in-style.

"When you miss apparel timeline, you don't get it back, and Target has more apparel exposure," he said.

Beyond its grocery-to-merchandise ratio, Walmart has another key advantage over Target: scale.

"Walmart is much bigger," Kantar analyst Gina Logan told BI. "And I'm not just talking about sales.

"They have a much more advanced supply chain," she added. "They have a wider range of suppliers, they have more ability to pivot and predict demand, and can use their automation and forecasting in order to react to this in a much faster, more predictive way than Target."

This is not the first time the Spark has found a competitive advantage over the Bullseye in the grocery aisle.

When US shoppers began to cut spending back in 2023, prioritizing essentials like groceries in their weekly budgets, sales at Walmart chugged along while Target struggled.

Target has since found success by taking a much more Walmart-like stance with price cuts and bargain brands, and its share of grocery sales has increased by 1-2 percentage points per year over the last three years.

Logan says tariffs could push Target harder into the grocery game, especially with its portfolio of private-label food brands.

Walmart reports its earnings next week and declined to comment. Target, which reports on March 4, did not immediately respond to a request for comment.

Neither company mentioned tariffs during their respective third-quarter earnings calls, both of which took place after the US presidential election.

However, Walmart CFO John David Rainey told CNBC later in November that Trump's sweeping tariff plan could lead the retailer to raise prices on a portion of its products.

"We never want to raise prices," he told CNBC. "Our model is everyday low prices. But there probably will be cases where prices will go up for consumers."

Before that, the last time the companies' executives discussed tariffs on earnings calls was in 2019, according to data from AlphaSense.

At the time, Walmart said it would not raise prices on food impacted by tariffs and would instead look to offset the cost elsewhere.

"As a guest-focused retailer," Target CEO Brian Cornell said in May 2019, "we're concerned about tariffs because they lead to higher prices on everyday products for American families."

He later said in a November 2019 call that then-President Trump's tariffs were amounting to $50 million to $60 million in added costs per quarter, adding that "obviously we're all facing the same tariff issues together."

But as Target's and Walmart's financials show, not everyone will be impacted by tariffs to the same degree.

• The daughters of one of Target's cofounders say they're "alarmed" at the company's DEI rollback.
• In letters to two newspapers, they said their father believed in clear principles.
• Target is among the companies scaling back diversity efforts amid political pressures against DEI.

The daughters of one of Target's cofounders say they're "shocked and dismayed" at the company's recent DEI rollback.

In letters to the editor published in the Financial Times and the Los Angeles Times, Anne and Lucy Dayton said their father, Bruce Dayton, believed in clear principles of happy customers and strong communities.

"We are alarmed how quickly the business community has given in to the current administration's retaliatory threats," they wrote. "It is not 'illegal' for a company to create a business model based on what it believes to be important ethical and business standards."

Bruce Dayton, who died in 2015 at 97, was one of five brothers who grew their father's Minneapolis department store into a national brand.

Neither the sisters nor Target immediately responded to requests for comment from Business Insider.

Target is one of several companies scaling back diversity efforts amid wider political scrutiny of DEI programs following Donald Trump's reelection.

CEO Brian Cornell said in 2023 that DEI was "the right thing for society, and it's the great thing for our brand."

Days later, the company began pulling LGBTQ+ pride merchandise after conservative activists mounted a campaign against the celebration.

In late January, a police pension fund in Florida filed a proposed class-action shareholder lawsuit against Target, alleging the company made "false and misleading" statements about its DEI strategy's effect on its financial results.

While some companies have announced their moves, others have discreetly removed references to DEI from their communications.

Some companies, including Deloitte and Google, have said that as federal contractors, they're required to follow Trump's recent executive order to end DEI programs at federal agencies.

"By cowering," the Dayton sisters said, "Target and others are undermining the very principles that have made their companies a success."

• A highly visible campaign against DEI is underway against companies like Costco.
• Political pressure is putting execs into a delicate balancing act over how to run their businesses.
• Experts said diversity and inclusion are more baked into corporate culture than ever.

Costco has found itself in the political crosshairs over DEI, and now some corporate leaders are left wondering who could be next.

In the meantime, some are choosing to make tweaks or changes.

On Tuesday, Disney's HR chief told employees the company is rebranding its DEI metrics and programs, as well as changing the language of some content advisories.

And last week, Google linked changes to its DEI initiatives to concerns over compliance with executive orders, as the tech giant is a federal contractor.

Although many lawsuits and shareholder proposals against diversity, equity, and inclusion have failed, experts told Business Insider that the highly publicized challenges, including executive orders from the White House, could still have a chilling effect.

Companies are walking a line. They don't want to get into legal hot water, and yet they likely don't want to be seen as retreating from the values they've espoused for years.

At the same time, the experts — two lawyers and a business researcher — say the growing pressure on CEOs to eliminate their DEI practices might ultimately amount to little practical change in some workplaces.

While some companies, most notably Costco, are digging in their heels in defense of DEI, others, like McDonald's, are taking a more conciliatory approach to the issue.

DEI policies get a facelift

The main changes companies make will likely boil down to how they communicate about their policies, both internally and externally, said Michael Thomas, a California attorney specializing in corporate diversity practices at the law firm Jackson Lewis.

Thomas said his firm has seen an increase in requests from companies to review their DEI initiatives for legal risks from clients who are also concerned about how they are perceived by employees and customers.

A major piece of the firm's legal review is examining how companies communicate about their policies and practices in websites, reports, and other filings, he said.

Indeed, some of the changes at Disney appear to be more about how the company talks about DEI.

"What won't change is our commitment to fostering a company culture where everyone belongs and everyone can excel," Disney's chief human resources officer, Sonia Coleman, said in a memo obtained by BI.

Emphasizing style more than substance could suggest a likely path forward for companies that see diversity and inclusion as beneficial to their business.

"Even Walmart and McDonald's have conceded less than meets the eye," Yale School of Management's Jeffrey Sonnenfeld told BI. "They're keeping the same principles and objectives. It's just a question of nomenclature, metrics, and bureaucracies."

McDonalds, for example, said in its memo to franchisees earlier this month that it was retiring "aspirational representation goals," swapping a broad vendor DEI pledge with direct discussions with suppliers about inclusion, and changing the name of its diversity team to be the Global Inclusion Team.

Sonnenfeld pointed to the way terms like sustainability, climate change, and pollution abatement have cycled through the corporate lingo while generally sharing a common objective of protecting the environment.

Diversity and inclusion, in many cases, have been around long enough at this point that they're often deeply embedded in corporate cultures, making it significantly harder to regulate, he said.

"It's impossible to the point of insanity to try to ferret that out," he added. "So the less modular it is, the less vulnerable they are."

Some companies may pull back

Still, the anti-DEI pressure could have other companies taking a more drastic shift, said Jon Solorzano, a partner at the law firm Vinson & Elkins who advises public and private companies on areas related to ESG and risk management.

Under this new administration, companies that may have been on the fence about DEI may decide to pull back some programs, he said.

"Different companies view this differently," he said. "Those that are probably in the more consumer-facing world are particularly sensitive to the reputational risks on both sides."

Among the major companies that BI has tracked as retreating on DEI over the past year, most follow a similar pattern: ending representation goals that could be construed as quotas for hiring or sourcing, halting participation in rankings and surveys, and reassigning DEI-focused staff and resources.

More recently, BI reported that Amazon has changed the language on its website regarding DEI. A senior AWS executive told employees in her division that there would be "no changes" to key DEI-related benefits, including a transgender benefit offered by the company.

And earlier in December, Amazon's VP of inclusive experiences, Candi Castleberry, said in a memo shared with BI that while the company was ending some "outdated" programs, it was part of an "evolution to 'built in' and 'born inclusive,' instead of 'bolted on.'"

Of course, rebranding alone is not an option at federal agencies under Trump's rules, which require a deeper review of a program's history. Private companies aren't subject to that same level of government scrutiny — for now, at least.

Last Wednesday, newly sworn-in US Attorney General Pam Bondi said the Justice Department intends to "investigate, eliminate, and penalize illegal DEI and DEIA preferences, mandates, policies, programs, and activities in the private sector."

"They really need to balance those risks," Solorzano said in reference to companies' decision-making. "What's more risky, the reputational harm of dealing with one of these investigations or having a mutiny of their employees?"

Business leaders make a case for diversity

JPMorgan, like Costco, has also taken a strong stand in defense of diversity, equity, and inclusion and is now the target of political and activist pressure.

At the World Economic Forum in Davos, Jamie Dimon shrugged off an investor group's opposition to JPMorgan's DEI policies. In 2020, the bank started tracking executives' progress toward DEI goals, which affects their compensation, but it doesn't disclose publicly what proportion of executive pay is linked to DEI work.

Solorzano said he believes there will likely be a "bifurcation" of companies over DEI. While many companies in recent years have adopted DEI programs, he said, "I also don't know that for every organization it was really core to their strategy."

"For places like Costco, it actually may be," he added.

In Costco's December statement to shareholders, the board said diversity "helps bring originality and creativity" to its offerings, leading to greater satisfaction for its increasingly diverse customer base.

A group of 19 Republican state attorneys general last month wrote a letter to Costco CEO Ron Vachris expressing "concerns" about the company's compliance with changing state and federal laws. The AGs' letter doesn't identify any specific allegations of illegal practices.

Solozano said the scrutiny Costco is facing — and how Costco responds — is "definitely being watched by all other major consumer branded companies right now."

• Egg prices are at record highs as US supply issues worsen.
• Grocery retailers, including some Costco and Trader Joe's locations, are limiting egg purchases.
• More than half of shoppers in a recent survey said they've seen shortages or out-of-stock notices for eggs.

This might not be the week to try your hand at making a soufflé.

Some grocery retailers are now limiting shoppers' egg purchases as US supply challenges push egg prices to record highs.

Business Insider saw signs at stores including a Costco in New Jersey, a Trader Joe's in New York, a Kroger-owned Metro Market in Wisconsin, and a Whole Foods in Wisconsin informing shoppers of limits on the number of eggs shoppers could buy, with all four citing supply issues.

A Trader Joe's spokesperson told BI the company was limiting customers to one carton per customer per day at all stores nationwide.

"We hope these limits will help to ensure that as many of our customers who need eggs are able to purchase them when they visit Trader Joe's," the spokesperson said.

The Costco location limited shoppers to 3 egg cartons. The Wisconsin store, a Metro Market location run by Kroger, asked customers to limit themselves to two packages each.

A nearby Whole Foods was limiting customers to three packs.

Spokespeople for Costco, Kroger, and Whole Foods did not respond to requests for comment.

Meanwhile, a representative for Texas-based grocer H-E-B said it remains in good supply and is working to manage costs to keep prices affordable.

A Target store in Wisconsin that BI visited wasn't limiting how many eggs patrons could buy, but signs on low-stock shelves informed customers that the chain is "actively seeking additional supply" and apologized for the inconvenience. Target did not respond to a request for comment.

More examples have been posted by US shoppers on social media.

A spokesperson for Walmart told BI that the retail giant hasn't instituted a national limit on eggs, except for the 60-count package, which is now limited to two per transaction. Walmart sells one in five eggs sold in the US, according to market research firm Numerator.

More than half of shoppers surveyed by Numerator said they've seen shortages or out-of-stocks for eggs at stores across the US.

The shortages were most pronounced in cities and in the Western US, with BJ's, Costco, Target, Trader Joe's, and Publix among the most affected brands, according to Numerator.

More than 70% of shoppers told Numerator that egg prices are "somewhat or very expensive" in their area.

The new policies come after numerous instances of shoppers buying up cartloads of eggs, apparently in response to the ongoing bird flu outbreak that has contributed to a lower supply of eggs.

Several videos have gone viral showing Costco shoppers clearing a pallet of eggs within minutes, and BI last week observed one Target shopper purchase a cart full of approximately 30 dozen eggs and nothing else.

If you are an egg shopper who wants to share your perspective, please contact Dominick via email or text/call/Signal at 646.768.4750.

The offers and details on this page may have updated or changed since the time of publication. See our article on Business Insider for current information.

• The secondary watch market has declined over the past years.
• But there are still makes and models that will sell for well above retail value.
• These are the 10 models that are the best investment right now — if you can find them new.

Last year was not kind to the secondary watch market — and things are not looking much better for the first quarter of 2025.

After peaking in May 2022, watch prices on the secondary market have fallen for 11 straight quarters, according to a report from WatchCharts and Morgan Stanley that came out earlier this month,

In the last months of 2024, the resale watch market continued to decline, with prices for the full year down 5.7% compared to 2023.

Over the past couple of years, inventory has flooded the resale market as those who purchased watches as an investment when the market was hot rushed to cash out. At the same time, the luxury market has struggled amid rising interest rates and economic uncertainty.

"Once they see the prices falling and that there's less liquidity in the market, they try to sell," Charles Tian, the founder and CEO of WatchCharts, told Business Insider. "That floods the market with inventory and inevitably drives prices down."

The market may not have reached an inflection point quite yet. The WatchCharts and Morgan Stanley report predicts secondary prices will "continue to fall for the foreseeable future."

"Most brands will need to navigate the widening gap between retail and secondary prices, driving more value-oriented consumers toward the secondary market and challenging brand perception by potentially making retail prices appear overpriced to some customers," the report's authors wrote.

Still, some watches make better investments than others.

The Big Three — Rolex, Patek Philippe, and Audemars Piguet — still make up about 64% of the market. As of January 2025, most Rolex and Audemars Piguet models trade above retail — 56% and 63%, respectively — as do 38% of Patek Philippe models, per the report.

"Luxury brands like Rolex and Audemars Piguet have a strategy of maintaining limited availability at official retailers, which often means that many of their most desirable models are perpetually sold out in stores," Paul Altieri, the founder and CEO of online luxury watch retailer Bob's Watches, said of the Big Three manufacturers, likening them to luxury fashion players like Hermès.

"Anytime you have demand exceeding supply, where the supply is limited, or demand is hyperinflated, you get this big disparity between secondary market value and retail price," he added.

Recognizable models like the Rolex Daytona or GMT-Master II are perpetually in high demand, Tian said, while other styles can rocket into the stratosphere because of social media trends.

Altieri said that classic Rolex styles, like the Daytona and Submariner, tend to be timeless, adding that the brand makes up more than 75% of Bob's Watches sales.

Chrono24, a Germany-based marketplace, pulled the 10 models selling at the highest premiums over the manufacturer's suggested retail price. The marketplace provided the resale prices in euros, which BI converted to US dollars as of February 3rd.

The majority of the watches on the list are Patek Philippe's Aquanaut model, a collection of minimalist and sporty watches that has been around for nearly three decades and comes in various metals and finishes.

While the numbers suggest these models make the smartest purchases, Altieri warns against choosing a watch solely because of its resale value.

"Find something you are going to enjoy, not something that you think will go up in value," he said. "Quality assets always go up in value, whether it's real estate, stocks, arts, or watches, so buy what you like."

Patek Philippe Aquanaut 5267/200A-001: 132% above retail

• Retail Price: $22,270
• Market Price: $51,790

Patek Philippe Aquanaut 5968A-001: 135% above retail

• Retail Price: $55,970
• Market Price: $130,850

Audemars Piguet Royal Oak 15407ST.OO.1220ST.02: 138% above retail

• Retail Price: $76,400
• Market Price: $181,990

Patek Philippe Nautilus 5712/1R-001: 142% over retail

• Retail Price: $85,900
• Market Price: $207,630

Rolex Oyster Perpetual 124300 Turquoise Celebration: 146% above retail

• Retail Price: $6,500
• Market Price: $16,015

Patek Philippe Aquanaut 5167A-001: 154% above retail

• Retail Price: $24,750
• Market Price: $62,960

Patek Philippe Aquanaut 5261R: 155% above retail

• Retail Price: $63,750
• Market Price: $162,680

Patek Philippe Aquanaut 5267/200A-010: 159% above retail

• Retail Price: $22,270
• Market Price: $57,595

Audemars Piguet Royal Oak 15416CE.OO.1225CE.01: 161% above retail

• Retail Price: $101,100
• Market Price: $263,742

Patek Philippe Cubitus 5821/1A-001: 173% above retail

• Retail Price: $41,240
• Market Price: $112,740

• In a matter of hours, the USPS said it had suspended and then resumed accepting parcels from China and Hong Kong.
• The head-spinning move comes as the carrier develops a way to collect tariffs on small packages.
• Parcels worth less than $800 were previously exempt from tariffs, but Trump has ended that policy.

Americans on the East Coast awoke to shipping chaos on Wednesday morning. The United States Postal Service was no longer accepting parcels from China and Hong Kong.

By the time those on the West Coast awoke, USPS said the suspension had been lifted.

The whiplash from the roughly 12-hour pause raised new questions about how exactly the world's sprawling shipping apparatus would navigate two major changes: the implementation of President Donald Trump's new tariffs against China and the end of a policy long used by Shein and Temu to avoid US import fees.

As the market reacted to the suspension in overnight trading, USPS said it was working to "implement an efficient collection mechanism for the new China tariffs to ensure the least disruption to package delivery."

The challenge likely facing USPS and other shipping firms arises from the fact that, ordinarily, companies are the ones to pay any tariffs on the products they bring in from overseas, the cost of which often gets rolled into the final price for end consumers.

Small parcels (worth less than $800) were generally excluded from import fees under a policy known as the de minimis exemption — and that made it convenient for the US Postal Service to accept e-commerce shipments from its Chinese counterpart, the China Post, along with postcards, letters, and other traditional mail for direct delivery to American addresses.

Meanwhile, companies like Shein, Temu, and others quickly figured out they could bypass existing US tariffs by shipping directly from China to US customers, leading the de minimis exemption to be dubbed a loophole.

A congressional report said that over 60% of all de minimis shipments to the US in 2021 came from China and that Temu and Shein were "likely responsible" for roughly a third of these small shipments to the US in 2022.

By contrast, the report estimated that Gap paid some $700 million in import duties in 2022, and H&M paid $205 million, while Temu and Shein each paid $0.

Trump's new tariff policy has largely closed that loophole. The policy now creates fresh uncertainties for businesses and consumers alike in a hyperconnected global marketplace.

For starters, the question of how to collect that fee in a direct-to-consumer transaction is not yet resolved, and it's not yet clear how businesses and their customers will respond to any resulting cost increases.

Plus, if orders are routed through some other channel or carrier, it's unclear how the change in parcel volumes could affect fulfillment prices or shipment times.

One company already adapting is Yun Express, a Chinese cross-border logistics company.

The company posted instructions for customers advising them of the new charges and requiring shippers to provide details about each package, including the item name, value, quantity, destination country code, and weight.

Yun Express also said it will begin charging a 30% prepayment for customs duties on shipments from China to the US, which will be adjusted and refunded based on actual fees imposed at the port of entry.

Global Data retail analyst Neil Saunders said in a note that there will likely continue to be strong demand for Chinese products, in spite of tariffs or other costs.

"While the era of frictionless e-commerce between the US and China is coming to an end, this does not signal the death of marketplaces like Shein and Temu," he said. "Even if prices rise, both will remain comparatively cheap, which taps into the continued consumer desire for low prices."

• Several companies — including Walmart — have recently walked back or softened their DEI policies.
• But Sam's Club CEO Chris Nicholas said "openness" and "connection" remain critically important.
• "We serve all of America," he told BI. "That's the definition of being inclusive."

Corporate DEI may be in retreat, but Sam's Club CEO Chris Nicholas says the principles of diversity and inclusion remain as important as ever.

"If you're willing to come here and work hard on behalf of our members and form relationships that allow you to develop as a human being and as a leader, there's nothing you can't do at Sam's Club," he told Business Insider. "I think that's true also of Walmart."

Walmart, which owns Sam's Club, is one of several companies that have recently walked back or softened their diversity, equity, and inclusion policies following the election of Donald Trump.

The company said in November that it would wind down its Center for Racial Equity, stop providing data to the Human Rights Campaign, and end the use of terms like "DEI" and "Latinx" in official communications.

"We are willing to change alongside our associates and customers who represent all of America," the company said at the time.

One thing that has already changed in recent years is the growth of Walmart's (and Sam's Club's) data on just about every aspect of its business, and Nicholas said that had a tremendous leveling effect.

"The data leads us to the answer," he said, "not historical views or personal proclivities."

The most obvious metric is whether something sells or doesn't. Offering only a few thousand items in a warehouse means that each product must perform well or get cut.

Beyond that, Nicholas pointed to Sam's Club's 50,000-member community of shoppers who share feedback with the company and one another. By providing a sense of welcome and belonging, the company is better able to discover unique "treasure hunt" offerings that excite members, he said.

"We serve all of America," he said. "That's the definition of being inclusive."

Sam's Club's larger rival, Costco, has also found itself in the political crosshairs over its diversity programs, which the company's board forcefully defended against a shareholder challenge.

"As our membership diversifies, we believe that serving it with a diverse group of employees enhances satisfaction," the Costco board wrote in December. "Among other things, a diverse group of employees helps bring originality and creativity to our merchandise offerings."

Nicholas said Sam's Club, too, relies on the diversity of its members and employees to find and deliver the best and most interesting products, which is good for business.

"If you get stale, people will just — you know — they won't engage with you," he said.

DEI, as it has been understood and communicated for the past decade or so, may be on the way out, but Nicholas said deeper changes are here for the long term.

"My job is to create an environment of openness and expansive thought and connection, and I think we do a really good job of that," he said.

• Walmart-owned Sam's Club has a "treasure trove" of purchasing data.
• CEO Chris Nicholas told BI this data is powering the company's big push into experiential retail.
• Nicholas has named Diana Marshall to be his new chief experience officer, or CXO — a relatively rare title in retail.

When Sam's Club CEO Chris Nicholas saw the news that his company had unseated perennial winner Costco as the top-rated retailer for customer satisfaction, he was understandably pleased — but he didn't bask in the feeling for long.

"There's more to do," he told Business Insider in an interview. "Nothing happens by accident."

The jump in Sam's Club's score — leapfrogging Costco's similarly strong rating — follows a busy year in which the Walmart-owned warehouse club rolled out new futuristic tech intended to make shopping easier and more enjoyable.

It was one year ago that the company announced its AI-powered exit gateways that are doing away with one of the biggest frustrations of shopping at a warehouse club: receipt checks at the exit. And in October, Sam's Club opened its first location without traditional checkout lanes.

It's a bold bet as some other retailers, like Amazon, pulled back from using AI-powered "Just Walk Out" cashierless tech at its Fresh stores in favor of smart carts, and others, including Target, have put new limits on self-service options at many locations.

For Sam's Club, it's part of a longer-term strategy to give it a high-tech edge in the historically low-tech warehouse retail segment. The company says more than half of customers at locations with the AI scan-and-go option use the tech, and it's helped the shoppers get out the door 23% faster.

"This is all a result of working really hard at the inputs and then the outputs heal themselves," Nicholas said. "Because we're building digital products for our associates as well as for our members, it means you create connected experiences that allow people to self-solve and work together on having a delightful experience."

One advantage that warehouse clubs, in general, have over their traditional retail counterparts is much more detailed information about shoppers' purchase histories, as a membership is required for every purchase. (General retailers can still piece together a profile using payment or loyalty cards, of course.)

At Sam's Club, however, member profiles are augmented by massive amounts of digital data, plus additional insights from the 50,000-strong Members Mark community of shoppers that share feedback on products and services.

"It's certainly true that we've had this treasure trove of data, and we've been on this journey the last couple of years to really hone it so that we understand and can use this data more specifically," Nicholas said.

Although Sam's Club doesn't publicly report detailed financial results, one consistent bright spot in Walmart's earnings in recent years has been the growth of revenue from memberships and from retail media.

In addition, Nicholas notes that much of the tech investment expenses for Sam's Club are borne by Walmart's deeper pockets, since the club has often served as an innovation lab for the world's largest retailer.

With all of this data, Nicholas says he decided to put one person in charge of turning it into a more effective flywheel for the business.

"The faster the flywheel spins, the more that virtuous circle helps you open up even a deeper gap versus everybody else," he said.

In this spirit, Sam's Club has appointed Diana Marshall, who was previously chief growth officer, as its new chief experience officer. Marshall will report directly to Nicholas.

CXO is a title that Constellation Research founder Ray Wang told BI is more typically found reporting to the CEO at tech, hospitality, travel, or financial services companies than at retailers. Sam's Club said it consulted with Wang on the strategy.

"We see chief experience officers, in general, playing a bigger and bigger role because you're basically differentiating on time and experience," Wang said. "If they are saving time, they'll pay a premium. If they get a better experience, they'll pay a premium."

Nicholas said that Sam's Club is committed to the long-standing warehouse club business model of earning most of its profits from membership income. That means any revenues — say, from the expected $100 billion retail media advertising market — will be reinvested in the business in the form of better technology, higher wages, and lower prices.

"I think we can create these unexpected, unforgettable, connected experiences from members, and I believe genuinely that that's going to redefine what the future of retail looks like," he said.

• Trump suggested on Thursday that diversity initiatives at the FAA led to a plane crash near DC.
• The president said he was offering a series of "very strong opinions and ideas" on what happened.
• He also criticized former Transportation Secretary Pete Buttigieg.

President Donald Trump and Vice President JD Vance on Thursday offered heated criticism of diversity initiatives at the Federal Aviation Administration following a deadly plane crash near Washington, DC.

After calling for a moment of silence, Trump spent the bulk of his remarks in the White House briefing room laying out a series of diversity initiatives within the FAA that he suggested could have contributed to the crash, which happened Wednesday evening.

At the same time, Trump repeatedly acknowledged that he did not have direct evidence of a causal link between those initiatives and the crash.

"We do not know what led to this crash, but we have some very strong opinions and ideas," Trump told reporters.

During his remarks, Trump also criticized former Transportation Secretary Pete Buttigieg, suggesting that the department's policies under him contributed to the crash.

"You know how badly everything's run since he's run the Department of Transportation?" Trump said of Buttigieg.

Buttigieg later hit back via X: "As families grieve, Trump should be leading, not lying."

Pressed by a reporter on why he thought diversity initiatives might be behind the crash, Trump said: "Because I have common sense."

Derrick Johnson, the president of the NAACP, said in a statement that his organization was "disgusted by this display of unpresidential, divisive behavior."

"We're proud to see thousands of first responders in the DMV region unify to support the enormous recovery efforts taking place on the Potomac," Johnson said. "The President has made his decision to put politics over people abundantly clear as he uses the highest office in the land to sow hatred rooted in falsehoods instead of providing us with the leadership we need and deserve."

Sen. Tammy Duckworth of Illinois, the top Democrat on the Senate commerce committee's Subcommittee on Aviation Safety, Operations, and Innovation, pushed back strongly on Trump's comments in a call with reporters.

"I have seen zero evidence at this point that's to suggest that this collision had anything to do with DEI," Duckworth said. "Speculation at this time is highly irresponsible, and we need to get to the facts."

Vance also criticized diversity initiatives, saying: "If you go back to just some of the headlines over the past 10 years, you have many hundreds of people suing the government because they would like to be air traffic controllers, but they were turned away because of the color of their skin. That policy ends under Donald Trump's leadership."

Since Trump reassumed the presidency last week, he's taken a series of actions aimed at ending diversity, equity, and inclusion efforts across the federal government, including one dealing specifically with the FAA. As a result, DEI-related offices in various agencies have shuttered.

Trump has directed agencies to compile lists of private companies to investigate over their DEI efforts, which could lead to a cascade effect in the private sector.

Many companies, including Meta, McDonald's, and Walmart, have decided in recent months to roll back or end their DEI programs.

"The legal and policy landscape surrounding diversity, equity and inclusion efforts in the United States is changing," Meta wrote in a memo to employees. "The Supreme Court of the United States has recently made decisions signaling a shift in how courts will approach DEI."

Target also recently said it was ending multiple DEI programs to stay "in step with the evolving external landscape."

Others, like Costco, have publicly supported DEI amid pressures from conservative activists. JPMorgan CEO Jamie Dimon recently defended the bank's diversity initiatives in response to activist investors.

• Executives are increasingly fielding analyst questions about the business impact of DeepSeek.
• Business Insider is keeping a running tally of CEOs who have talked about DeepSeek on earnings calls.
• In spite of the market disruption, the early outlook is generally optimistic about the tech.

If there was a bingo card for company earnings calls this quarter, DeepSeek would deserve its own square.

Stock market surprises have a way of echoing through subsequent earnings calls, and the impact of DeepSeek is reverberating on Wall Street.

On recent analyst calls, executives have increasingly fielded questions about the Chinese AI upstart and what its more cost-effective model means for their businesses.

The name DeepSeek was mentioned in at least nine earnings calls last week, according to an AlphaSense search, with only a single mention prior to the company's bombshell announcement about its AI models. That number has grown as major tech companies including Alphabet, AMD, Palantir, and Amazon report their earnings.

But in spite of the market disruption that saw wild swings in Big Tech share prices, the early outlook is generally optimistic about the tech.

Here's what business leaders are telling analysts:

Airbnb

Airbnb's CEO, Brian Chesky, said AI and low-cost models like DeepSeek will have a "profound impact on travel."

In a fourth-quarter earnings call on February 13, Chesky said that it will use AI to improve its customer service and transform Airbnb's search engine into a "travel and living concierge."

"I think it's a really exciting time in the space because you've seen like with DeepSeek and more competition with models is models are getting cheaper or nearly free, they're getting faster, and they're getting more intelligent and for all this purpose, starting to get commoditized," he said to investors.

He added that the best platforms and applications moving forward would be those that "most accrue the value from AI," and Airbnb would be the travel platform that does that.

ARM

DeepSeek is "great for the industry," said Rene Haas, the CEO of ARM, on the chipmaker's February 5 earnings call.

"It drives efficiency, it lowers the cost. And by doing that, it expands the demand for overall compute. So, just from a general standpoint, it's a good thing," he said.

Haas referenced the controversy over how DeepSeek created its latest model — OpenAI is investigating whether the company trained on the Microsoft-backed company's technology. Haas called DeepSeek's approach "creative."

He also compared the product to Grace Blackwell architecture, highlighting that while Nvidia's product is "wonderful," it couldn't go in a cellphone, earbuds, or other smaller electronics that ARM targets.

"When you think about the application to ARM, given the fact that AI workloads will need to run everywhere and lower-cost inference, a more efficient inference makes it easier to run these applications in areas where power is constrained," Haas said.

AMD

Lisa Su, the CEO of AMD, said DeepSeek is driving innovation that's "good for AI adoption" in an earnings call on February 4.

"The fact that there are new ways to bring about training and inference capabilities with less infrastructure actually is a good thing, because it allows us to continue to deploy AI compute and broader application space and more adoption," Su said.

She added that AMD is a "big believer" in open source.

"And from that standpoint, having open source models, looking at the rate and pace of adoption there, I think, is pretty amazing," Su said. "And that is how we expect things to go."

Google

Google's CEO Sundar Pichai said in an earnings call on February 4 that DeepSeek had done "very good work."

"Look, I think there's been a lot of observations on DeepSeek. First of all, I think a tremendous team," he said to investors. "I think they've done very, very good work."

He said that for Google, it had "always been obvious" that frontier models could be made to be more efficient over time.

But he downplayed DeepSeek's threat, saying that he thinks Google's Gemini model is the "Pareto frontier of cost, performance, and latency."

He added that Google's recent 2.0 Flash Thinking models are "some of the most efficient models out there, including comparing to DeepSeek's V3 and R1."

Palantir Technologies

Shyam Sankar, CTO of Palantir Technologies, fielded a question about DeepSeek during the company's earnings call on February 3. He said DeepSeek demonstrated that AI models are "commoditizing."

"But I think the real lesson, the more profound one, is that we are at war with China," Sankar said, adding, "We are in an AI arms race."

He also criticized the explanation that "the Chinese just copy and we're the only innovators," an apparent reference to reports that DeepSeek may have copied OpenAI.

He said the engineering in DeepSeek's R1 model was "exquisite" and that "the optimizations that they've done are really impressive."

"We have to wake up with the respect for our adversary and realize that we are competing," Sankar said, adding, "We have to realize that the AI race is winner take all."

"The time to mobilize has come," he said.

Apple

An analyst asked Apple CEO Tim Cook for his perspective on the "DeepSeek situation" during the company's quarterly earnings call on January 30.

"In general, I think innovation that drives efficiency is a good thing," Cook said. "That's what you see in that model."

The CEO said he thought the company's "tight integration of silicon and software" would continue to serve them well.

"From a CapEx point of view, we've always taken a very prudent, deliberative approach to our expenditure, and we continue to leverage a hybrid model, which I think continues to serve as well," Cook said, referring to Apple's AI strategy.

Meta

Meta CEO Mark Zuckerberg acknowledged DeepSeek as a "new competitor" during an earnings call on January 29. An investor asked him about the competitive dynamic in the open-source field.

"In light of some of the recent news, you know, the new competitor, DeepSeek from China, I think it's also one of the things that we're talking about, is there's going to be an open-source standard globally, and I think for our own national advantage, it's important that it's an American standard," Zuckerberg said to investors.

He added that the emergence of DeepSeek has "only strengthened our conviction that this is the right thing for us to be focused on."

Later in the call, he said that DeepSeek did "a number of novel things" to train its model fast and cheaply, which Meta was "still digesting." He added that DeepSeek has made advances that Meta hopes to implement in its systems.

Microsoft

Microsoft CEO Satya Nadella mentioned DeepSeek twice in his prepared remarks during an earnings call on January 29.

He said that the Copilot+ PC laptops, which Microsoft has called the "fastest, most intelligent Windows PCs ever built," would soon be able to run DeepSeek's R1 distilled models locally.

When asked about DeepSeek by an investor, he said, "I think DeepSeek has had some real innovations. And that is some of the things that even OpenAI found in o1."

IBM

IBM's CEO Arvind Krishna fielded a DeepSeek question during an earnings call on January 29.

When asked about what implications DeepSeek could have for IBM or the industry at large, Krishna said, "Look, DeepSeek, I think, was a point of validation."

"We have been very vocal for about a year that smaller models and more reasonable training times are going to be essential for enterprise deployment of large language models," he said.

The tech giant's chief added that IBM has been going "down that journey" itself "for more than a year" and that it has seen "as much as 30 times reduction in inference costs" with those approaches.

"As other people begin to follow that route, we think that this is incredibly good for our enterprise clients," Krishna said.

AT&T

AT&T CEO John Stankey said the newer, lower-cost AI "is going to open up and facilitate new applications and business models."

"This is a seminal technology cycle," Stankey said on January 27 of generative AI. "It's going to be every bit as big as the founding of the Internet when it's all said and done."

Stankey added that new breakthroughs like DeepSeek that use less processing capacity, consume less power, work more effectively in particular domains, or can be run on local devices instead of in the cloud will ultimately lead to new applications and business models.

"We're all going to have to stay on our game to make sure we use it effectively so none of us are in a disadvantaged position relative to our competitors on cost-structure effectiveness," he said.

Corning

Wendell Weeks, CEO of glassmaker Corning, which produces fiber optics that are increasingly critical in high-speed networking, said the technical community has been watching DeepSeek for the last few months.

"What's super important to understand is that we need dramatic improvement in training and inference cost to make GenAI into a highly sustainable business model, and more importantly, the productivity driver that we all hope it will be," he said.

"All of us in the space are counting on many more innovations to come," he continued, adding that AI models of the future will continue to need improvements in computation and communication technologies.

Flex

Revathi Advaithi, CEO of mid-cap datacenter company Flex, acknowledged "a lot of noise this week," but said DeepSeek itself doesn't represent anything new in terms of demand for AI infrastructure.

"At the end of the day, compute density is still a big deal," she said. "We think lower cost in applications like DeepSeek is a good thing for the industry as a whole because it's going to drive a stronger growth in terms of the market itself."

In addition, Advaithi said lower barriers to entry could spur more widespread innovation in AI, driving additional demand for infrastructure providers like Flex.

"We haven't seen enough growth from non-Mag Seven companies and we'll start to see a lot more of that," she said. "It actually accelerates the move towards AI."

Amazon

Amazon CEO Andy Jassy said on Thursday that leaders at the company "were impressed with what DeepSeek has done."

Different AI models will challenge and pass each other when it comes to capabilities, he said on Amazon's earnings call.

"Different customers are going to use different models for different types of workloads," Jassy said. "You're going to provide as many leading frontier models as possible for customers to choose from."

He also said that DeepSeek's cheaper costs aren't a problem for the industry. When technologies become less expensive, some people say "that somehow it's going to lead to less total spend in technology," he said.

"We have never seen that to be the case," Jassy added.

• Costco's commitment to diversity and inclusion is facing fresh scrutiny from Republicans.
• In a letter to CEO Ron Vachris, 19 attorneys general urged the company to end its DEI programs.
• Costco shareholders last week overwhelmingly rejected a proposal to report on potential DEI risks.

Costco appears to have a target on its back.

The wholesale club's commitment to DEI is facing fresh scrutiny from 19 Republican attorneys general who say the retailer is "clinging" to "divisive and discriminatory DEI practices."

Led by Iowa's Brenna Bird and Kansas' Kris Kobach, the group sent a letter to Costco CEO Ron Vachris urging him to "end all unlawful discrimination imposed by the company through diversity, equity, and inclusion" policies.

The letter also cites President Donald Trump's executive order from last week that encouraged private companies to end DEI-related initiatives while moving to end the programs at federal agencies.

"Costco should not have policies that discriminate in hiring based on race or gender," the letter said.

The attorneys general did not identify in their letter any specific allegations of discrimination that had occurred at Costco as a result of its diversity-related policies. However, they said that several companies had faced lawsuits related to DEI policies and that ending them would reduce Costco's legal exposure.

Last week, 98% of Costco shareholders rejected a proposal from a conservative think tank to report on any legal and financial risks arising from DEI policies.

"The overwhelming support of our shareholders' vote really puts an answer to that question," Vachris said following the news.

The attorneys general said Costco had 30 days to either notify them that it had ended its DEI policies or explain why it had not.

Many companies, including Meta, McDonald's, and Walmart, have decided in recent months to roll back or end their DEI programs. Target said on Friday that it was ending multiple DEI programs in an effort to stay "in step with the evolving external landscape."

Others, like Costco, have publicly supported DEI. JPMorgan CEO Jamie Dimon recently defended the bank's diversity initiatives.

"We are going to continue to reach out to the Black community, the Hispanic community, the LGBT community, the veterans community," Dimon said.

If you are a Costco worker who wants to share your perspective, please contact Dominick via email or text/call/Signal at 646.768.4750. Responses will be kept confidential, and Business Insider strongly recommends using a personal email and a nonwork device when reaching out.

• Walmart-owned Sam's Club saw a huge jump in this year's customer satisfaction rankings.
• Meanwhile, longtime leader Costco's score remained flat.
• The report credits Sam's Club's spiffy new checkout tech with helping improve the shopper experience.

It appears Sam's Club has had enough of waiting in line.

The Walmart-owned wholesale club jumped ahead of rivals to place first in this year's customer satisfaction rankings for general merchandise retailers, scoring a whopping 85 points.

Sam's Club posted the biggest improvement of any major general merchandise retailer, and it also managed to unseat its chief rival and longtime category leader, Costco, in the top spot.

The American Customer Satisfaction Index, which publishes the annual rankings, cited Sam's Club's popular Scan & Go app feature and its new AI-powered exit tech as driving a big share of the company's appeal to shoppers.

"We're seeing a clear divide emerge between brands that are meeting the needs and expectations of younger consumers versus those that are falling behind," ACSI Director of Research Emeritus Forrest Morgeson said in a statement, adding that digital features continue to have a significant impact on younger generations' satisfaction ratings.

Costco's score of 82 remained flat for a third year, while BJ's Wholesale Club's score fell by two points from last year to 78.

Costco and BJ's did not immediately respond to requests for comment on the rankings.

The report, which is based on nearly 42,000 completed customer surveys, doesn't suggest Costco did anything wrong — it was at the top of the heap for years with its very respectable 82 points, but Sam's Club is showing that the ceiling can be higher than it has been.

Beyond Sam's Club's app and receipt-free exit, which makes it easy to shop in the warehouse without waiting in slow lines, the report also notes that the company has outperformed its peers when it comes to the speed and accuracy of online order fulfillment — especially at curbside.

For its part, Costco has dipped its toe into the digital water in recent months with a few updates like ID scanning and inventory availability, but it has nothing yet to match Sam's Club's tech, as embodied by the AI-powered exit gateways.

These rankings suggest that Costco is doing quite well with its customers — Sam's Club is just raising the bar.

Sam's Club CEO Chris Nicholas told Business Insider back in October that he wants shopping at Sam's Club to be a "delightful" experience.

"My hope is that Sam's Club, when you shop, feels like what it's like to shop in the future," he said. "This is a glimpse of that."

If you are a Costco or Sam's Club worker who wants to share your perspective, please contact Dominick via email or text/call/Signal at 646.768.4750. Responses will be kept confidential, and Business Insider strongly recommends using a personal email and a non-work device when reaching out

• Costco's CEO Ron Vachris said crowded parking lots are a key concern for the wholesale club.
• In some cases, busy locations are a sign that the company needs to open a new warehouse nearby.
• One recent opening in the Bay Area is situated near three existing high-volume locations.

Costco's popularity comes at a notable cost: parking at some warehouses can be downright nightmarish.

One shareholder even put the question directly to CEO Ron Vachris this week at the company's annual meeting: "What is your plan to address lack of adequate parking in your warehouses?"

Vachris said that some options include buying nearby land to add space or building upper-level parking on top of some locations.

But full parking lots generally mean busy warehouses, and that's where a more recent trend has been emerging for the company: just add a whole new warehouse nearby.

Vachris said the company refers to the move as "cannibalizing these buildings to take some pressure off."

One of Costco's most recent openings — in Pleasanton, California — is exactly this sort of play.

The new location sits between three older high-volume warehouses in the Bay Area and still managed to do the highest-ever US opening day sales for the company, with a whopping $2.9 million.

These so-called in-fill locations are an increasingly important piece of Costco's growth strategy, execs have said on earnings calls.

Last May, Vachris said eight locations were opening that year that initially cannibalized existing Costco warehouses. That accounts for about a third of the total number of new locations Costco typically opens in a year worldwide.

"We had one in Toronto that cannibalized four buildings around it, but they've built back their sales within six months," he said.

In addition, when customers spend less time trying to find a parking spot (and less time waiting in lines in the warehouse), Vachris said they're much more likely to come back more often and spend more money.

"Frequency improves significantly because members can get back into a high-volume club," he said. "And so it's strategic cannibalization."

So the next time you find yourself sitting in your car waiting for someone to Tetris a super-sized pack of toilet paper into an overstuffed Toyota Prius, it could be the first sign that Costco is dreaming up plans for a new warehouse nearby.

• Target said Friday that it is ending multiple diversity-related programs.
• A memo said the moves help the company remain "in step with the evolving external landscape."
• The reversal follows moves by several major retailers, including Walmart and Tractor Supply Co.

Target is the latest major retailer to reverse course on its diversity, equity, and inclusion initiatives.

In a Friday memo to staff, Target's chief community impact and equity officer, Kiera Fernandez, said the company is ending multiple diversity-related programs, including the planned conclusion of a racial equity initiative and the end of all external diversity surveys.

Fernandez said the strategy was based on "many years of data, insights, listening and learning" to help the company remain "in step with the evolving external landscape."

In addition, the memo said Target is renaming its "Supplier Diversity" team as "Supplier Engagement" and will evaluate its corporate partnerships.

The reversal follows moves by several major retailers in recent months, including Walmart and Tractor Supply Co., as well as this week's sweeping new rules from President Donald Trump ordering the end of DEI programs at federal agencies.

Not all companies are bowing to the mounting anti-DEI pressure. On Thursday, Costco shareholders overwhelmingly rejected a proposal from a conservative think tank to evaluate the potential legal and financial risks of the wholesale club's DEI-related policies after the company recommended investors vote against it.

In finance, JPMorgan CEO Jamie Dimon affirmed his company's commitment to DEI and dismissed a conservative shareholder group's criticisms. "Bring them on," he said.

Target has faced pressure from conservative groups over the years in response to issues ranging from what shelves toys are sold on to the company's offering of LGBTQ+ merchandise during Pride month.

CEO Brian Cornell previously defended DEI as "good business decisions, and it's the right thing for society, and it's the great thing for our brand."

Read the memo sent to Target employees:

From: Kiera Fernandez
Subject line: Belonging at the Bullseye

Hi team,

As we close the fiscal year and welcome 2025, I want to share how my team and I have been planning for the year ahead and beyond, ensuring even closer connections to our enterprise roadmap for growth.

For more than 20 years, Target has fueled our business by building teams with diverse perspectives and experiences, creating inclusive work and guest environments that welcome all, and developing strategies that represent the U.S. consumers we serve.

We've also deepened our understanding of how building a sense of belonging for every member of our team, guests and communities can help drive our business and strengthen our culture. So, as
we kick off the new year, we will further our commitment to growth and opportunity for all through our strategy, Belonging at the Bullseye.

Many years of data, insights, listening and learning have been shaping this next chapter in our strategy. And as a retailer that serves millions of consumers every day, we understand the importance of staying in step with the evolving external landscape, now and in the future — all in service of driving Target's growth and winning together.

You can find more here, including details on the actions we're taking, with the goal of driving growth. In the coming weeks and months, you'll see me and my team continue to guide and partner across the enterprise to bring this strategy to life.

In my 23 years as a team member, there are so many things I have loved about Target and our culture. At the top of the list is our conviction to always move forward — listening, learning, growing and setting standards of excellence. I am excited about this next chapter, and confident that our business and culture will continue to be strengthened through the power of belonging.

Onward,
Kiera

If you are a Target worker who wants to share your perspective, please contact Dominick via email or text/call/Signal at 646.768.4750. Responses will be kept confidential, and Business Insider strongly recommends using a personal email and a non-work device when reaching out

• Costco CEO Ron Vachris confirmed rumors that Coca-Cola products are coming back to the food court.
• The decision to switch to Pepsi in 2013 caused a stir among some members.
• It's another victory for Coke, which holds around double the market share of Pepsi.

Costco members will soon be able to have their $1.50 hot dog and soda combo the way it was enjoyed more than a decade ago: with an ice-cold Coke.

On Thursday a question-and-answer portion of the company's annual shareholder meeting, CEO Ron Vachris confirmed recent rumors that Coca-Cola products are returning to the food court.

"Is the food court truly switching back to Coke products?" a questioner asked.

"Yes, that is accurate," Vachris responded. "This summer, we will be converting our food court fountain business back over to Coca-Cola."

The change reverses a move from 2013 when the warehouse club pulled Coke products in favor of Pepsi at its food courts — a move that caused a bit of a stir among some members at the time.

"You're not going to be able to please everybody," then-VP of food services Alan Bubitz told BevNET. "It's our job to preserve the integrity of the price point."

The key price point in this case being the all-important $1.50, which founder Jim Sinegal famously warned his successor Craig Jelinek not to raise under any circumstances.

The social media response to last month's rumors was mixed, but at least one Reddit user was thrilled: "If they put Cherry Coke in the mix, I'm stopping at the food court EVERY. SINGLE. TRIP."

It's yet another victory for long-dominant Coca-Cola, which holds more than double the market share of Pepsi, according to a ranking from Beverage Digest last year. Coke Classic garnered an estimated 19.2% share of the US carbonated soft drink market, while Pepsi notched 8.31%, down from its 1995 peak of 15%.

A Business Insider tally of major quick-serve brands in 2023 found that roughly half as many fast-food restaurants serve Pepsi as serve Coke.

If you are a Costco worker who wants to share your perspective, please contact Dominick via email or text/call/Signal at 646.768.4750. Responses will be kept confidential, and Business Insider strongly recommends using a personal email and a non-work device when reaching out