Quick Facts
- BJ’s Wholesale Club plans to cut about 20% of its SKUs over the next two years, reducing average club inventory from 7,500 items to between 6,000 and 6,500.
- The retailer reported Q2 fiscal 2026 net income of $173.9 million on total revenue of $6.23 billion, with comparable club sales up 11.9% year over year.
- BJ’s raised its full-year adjusted EPS guidance to $4.60 to $4.80, up from a prior range of $4.40 to $4.60.
BJ’s Wholesale Club is cutting roughly one in five products from its shelves. CEO Robert Eddy announced the move during the company’s August 21 earnings call, framing it as a deliberate push to eliminate duplication rather than simply shrink selection.
‘We find ourselves over-SKUed,’ Eddy said. ‘It has been a longstanding opportunity. We have had efforts to cut SKU count in the past, and I would argue we didn’t prosecute that opportunity in the right way. We just cut SKUs, which cut sales, and then we added some SKUs back.’
This time, the approach is more surgical. The company is targeting categories where the same product exists in multiple formats or scents, not categories where choice is already thin. In beverages, for example, BJ’s stopped carrying the same soda brand in cans, one-liter, and two-liter formats simultaneously. It also added what Eddy called ‘healthy soda like coffee’ to fill the freed-up shelf space.
The same logic applies to personal care. Instead of stocking a body wash in six scents, BJ’s may carry two and push volume into those remaining options. The goal is higher sales per SKU, not lower sales overall.
‘We are removing unnecessary SKUs and adding new innovative products in whitespace categories,’ Eddy said.
The target SKU range of 6,000 to 6,500 mirrors what BJ’s newest club locations already carry. Legacy clubs currently average about 7,500 SKUs. For context, supermarkets typically stock around 40,000 SKUs, and supercenters can exceed 100,000.
BJ’s said it identified reduction categories in Q2 and ‘saw some good results.’ The full rollout will happen gradually across its 267 clubs across 22 states.
The announcement came alongside a strong quarter. Net income rose to $173.9 million from $150.7 million a year earlier. Total revenue climbed 15.7% to $6.23 billion. Digitally enabled comparable sales grew 30%, reflecting a two-year stacked comp growth of 64%. Membership fee income increased 9.9% to $135.6 million, and member count hit a record 8.5 million.
Adjusted earnings of $1.36 per share beat the Zacks Consensus Estimate of $1.16 by 17.2%. CFO Laura Felice said the company ‘delivered solid profitability, grew membership fee income, and outperformed on gas,’ enabling the raised full-year guidance.
For brands selling into BJ’s, the strategy creates clear risk. Products sitting in overcrowded categories with slow velocity or high duplication are most exposed. A brand with three similar items on the shelf may find that BJ’s buyers decide two are enough, regardless of individual item performance.
The broader retail food and beverage market adds pressure. Circana data shows U.S. retail food and beverage sales grew only 2.2% in the first half of 2026, with all growth coming from price and unit volume flat. Circana projects 2% to 3% growth through 2027 and describes the period as one of rationalization.
BJ’s move fits that pattern. Warehouse clubs operate on thin margins and high volume. Simplifying assortments reduces labor costs, speeds restocking, and makes stores easier for members to navigate. Eddy said BJ’s will remain ‘sensitive’ to member needs when deciding what gets cut.
Customer traffic rose 4.9% year over year in the quarter, a sign that members are responding to the current assortment before the full SKU reduction takes effect.
Read more: BJ’s cuts 20% of SKUs to reduce ‘unnecessary choice’
