The retailer's websites resemble those of many other discounters, offering deals on a broad range of products such as televisions, tablets, blenders and sports equipment.
But San Diego-based PriceSmart Inc. is distinctive in other ways. Each of its three dozen warehouse membership clubs are south of the 48 contiguous states, spread from the U.S. Virgin Islands in the north, through Central America and south to Colombia.
PriceSmart was the third venture begun by Sol Price, a serial entrepreneur with a penchant for unusual business ideas. The chain was co-founded in 1994 with Price's son, Robert, who remains with the company as its board chairman. Sol Price died in 2009.
The elder Price began his retail career in 1954 by opening Fedmart, which grew to 45 stores and more than $300 million in annual sales. Price sold most of Fedmart to a German investor in 1975 and was forced out of his leadership position the following year.
In 1976, Price established the Price Club warehouse chain in San Diego. Price Clubs were simple, no-frills warehouses offering goods for sale in bulk, at a discount. Critics said the stores resembled something that the
By 1993, there were 94 Price Club stores. Even though the company's sales were second only to Sam's Club at the time, competitors had stolen much of its momentum. That same year, Price Club merged with Costco Wholesale Corp.
PriceSmart differentiated itself by operating primarily in Latin America, where demand was high for Sol Price's style of store, but where rivalries would be limited.
The first PriceSmart opened in Panama in 1996. The company went public in 1997.
Annual PriceSmart memberships cost $35 for consumers and $30 for businesses. Most PriceSmart clubs accept most major credit cards, debit cards and personal checks.
On Friday, PriceSmart said that revenue for the three months ended Nov. 30, the first quarter of its fiscal year, rose to $656 million, from $605.6 million a year earlier. Net income for the quarter declined to $20.6 million, from $21.4 million a year earlier.
In November, the company announced that it had opened warehouse clubs in Pereira and Medellin, Colombia, the fifth and sixth PriceSmarts in that country.
With 36 stores, PriceSmart is the largest operator of warehouse membership clubs in Latin America, analysts say.
PriceSmart is in an expansion mode. On Friday, during a conference call with analysts, Chief Executive Jose Luis Laparte said that "it was certainly one of the busiest quarters we have at PriceSmart with the opening of three new warehouse clubs in a six-week period."
PriceSmart's success is dependent on the economic conditions in the emerging economies in which the company operates.
Currency fluctuations can also be a problem, as Laparte pointed out in the quarterly earnings call. "While Colombia is a very exciting market for us, it is not without its challenges," he said, later noting that the "Colombian peso has been on a significant decline against the U.S. dollar."
The company does not get a lot of attention from Wall Street. Of the three analysts who regularly cover PriceSmart, one rates it a buy and two suggest holding the stock.
Dave King, an analyst with Roth Capital Partners, has a buy rating on the stock, saying "stronger membership growth and new store productivity should drive better overall revenue gains. Our buy [rating] reflects PSMT's quality business model, leading market position and robust growth profile."