Posted October 11, 2018 06:20:37The deal, announced by Costco on Tuesday, will allow the chain to continue selling a wide range of groceries from its stores and online, but it’s also a major boost for the struggling grocery business.

Costco says the deal will allow it to continue growing its retail business as it looks to grow from its current footprint of about 2 million square feet to a much larger 3 million-square-foot footprint in the coming years.

In addition to growing its grocery business, Costco said it would also be investing in new technology to improve its delivery service. 

Costco said it will pay for the deal through its $1.4 billion sale of its Whole Foods business to Walmart. 

“We are excited to continue our partnership with Walmart and we look forward to sharing more details about the details of the new agreement soon,” Costco CEO Dan Mullen said in a statement.

“Our commitment to the Costco brand is unshakable.

We are confident that with this new arrangement, we will continue to make the Costco name a part of every member’s shopping experience and will further strengthen the quality and value of our products,” he added. 

While the deal is a win for Walmart, it comes at a significant cost to Costco.

The chain is facing a massive deficit and is spending about $300 million a year on groceries and other grocery products, which it’s struggling to absorb.

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