Costco Wholesale recently opened a membership-only gas station in Nanjing, China's eastern Jiangsu province, the US big-box retailer's first on the Chinese mainland.

Costco set up the membership-only gas station to develop a loyal customer base by offering comprehensive services with more economical transportation costs amid intensifying competition in the retail market, a worker told Yicai.

Costco's newly opened gas station is located near its Nanjing store, scheduled to open on May 28, Yicai found. It also offers various types of gasoline priced 10 percent to 15 percent lower than the overall cost on the local market.

The station has 24 stands, with the gasoline supplied by Sinochem Oil, a unit of Chinese chemical giant Sinochem Group, the worker noted. Annual Costco membership costs CNY299 (USD41), but it is now offered at a discount price of CNY199, he added.

According to a few customers interviewed by Yicai, refueling a full tank saved them around CNY30 (USD4.20), so they can recuperate the membership fee after several visits.

Costco's latest move shows that rivalry is increasing in the Chinese mainland's emerging membership retail market, Shen Jun, a senior retail industry analyst, told Yicai. The firm is willing to provide services other than retail to stabilize its customers' source, Shen noted.

Doing business following a conventional retail format is becoming increasingly hard, Shen pointed out. More retailers and capital will likely move toward a membership store business format, leading to continued market competition, Shen added.

Costco has six stores in five major Chinese cities, with the one in Nanjing to become its seventh in the sixth different city. The Washington-based company provides catering, gas refueling, tire, optometry, and eyeglass prescription, among its main retail services, to attract more customers with low prices.