The Single-Store State: Why South Dakota Only Has One Costco Location (2025 Update)

The question of "How many Costco stores are in South Dakota?" is a simple one with a complex answer that speaks volumes about corporate expansion strategy and regional economics. As of late 2025, South Dakota remains one of the few states in the US that hosts only a single Costco Wholesale warehouse, a distinction that frustrates thousands of residents across the vast prairie landscape.

This single location, situated in the state’s largest city, has become a regional shopping magnet, but the long-standing rumors of a second store—particularly in the western part of the state—have recently been put to rest by local officials. This comprehensive 2025 update details the one existing store, debunks the persistent expansion rumors, and provides the essential driving distances for residents living outside the Sioux Falls metro area.

The Single Pillar: South Dakota’s Only Costco Warehouse

South Dakota’s only Costco location is not a new development; it has been serving the state’s most populous region for over a decade. This store is a crucial retail hub, drawing shoppers not just from the immediate Sioux Falls area but also from parts of Iowa, Minnesota, and the more distant reaches of South Dakota itself.

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Sioux Falls Costco Location Profile

• City: Sioux Falls, South Dakota
• Address: 3700 S Grange Ave, Sioux Falls, SD 57105
• Opening Date: October 3, 2013
• Key Services: Full-service Gas Station, Tire Center, Pharmacy, Food Court, Hearing Aid Center, Optical Department.
• Significance: It is the primary membership warehouse for the entire state and the eastern South Dakota region.

The Sioux Falls warehouse is known for being exceptionally busy, often described in local forums as "overrun" due to the massive regional demand it absorbs. This high traffic volume is often cited by residents as the most compelling evidence for why a second location is desperately needed, especially in the western half of the state.

Debunking the Rapid City Costco Rumors (2025 Update)

For years, the most frequent and fervent speculation about a new South Dakota Costco has centered on Rapid City, the state's second-largest metropolitan area and the gateway to the Black Hills National Forest. However, the most recent updates from 2024 and 2025 have confirmed a disappointing reality for western South Dakota shoppers.

Official Stance: City officials in Rapid City have publicly stated that there are no current, confirmed plans for a Costco to open in the area "any time soon," effectively debunking the latest round of rumors. This news is a significant setback for the local retail landscape, which currently relies on competitors like Sam's Club for warehouse-style shopping.

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Why Costco Hasn't Expanded to Rapid City

Costco Wholesale Corporation is famous for its meticulous and conservative approach to expansion, a strategy that often limits its growth to only 25 to 30 new locations globally per year. While Rapid City's population continues to grow, there are several key corporate criteria that the area appears to be struggling to meet, according to community discussions and expert analysis:

• Population Density and Market Size: Costco typically targets metropolitan areas with a minimum of 200,000 to 250,000 people in the immediate trade area. While the Rapid City area is growing, it may not yet meet the strict threshold for a standalone, high-volume Costco warehouse.
• Disposable Income and Wages: A recurring point in local discussions is the issue of lower average wages in the Rapid City area compared to the Sioux Falls market or other cities where Costco expands. Costco’s business model relies on a high volume of members with sufficient disposable income to make large, bulk purchases.
• Logistics and Supply Chain: Locating a second warehouse in western South Dakota would require significant adjustments to the existing supply chain, which is currently optimized around the Sioux Falls hub in the eastern part of the state.

The failure of the rumored development near the Liberty Land area to materialize has solidified the fact that a second South Dakota Costco is not on the company’s immediate 2025 expansion list, which includes new locations in states like Michigan, Pennsylvania, and South Carolina.

The Long Drive: Closest Alternatives for South Dakota Residents

For the majority of South Dakota residents, a trip to Costco involves a significant road trip. Understanding the closest options, both in-state and out-of-state, is essential for planning those bulk shopping excursions.

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Distances to the Nearest Costco from Major South Dakota Cities

The distances highlight the retail isolation experienced by residents in the central and western parts of the state. For many, driving to a neighboring state is actually a more practical option than driving to Sioux Falls.

For Rapid City and Western SD Residents

Residents in the Black Hills region and cities like Spearfish and Sturgis face the longest drive. Their in-state option, Sioux Falls, is approximately a 5-hour, 327-mile journey. The closest out-of-state alternatives are often preferred:

• Cheyenne, Wyoming: Approximately 268–308 miles (5–5.5 hours driving).
• Denver, Colorado: A much longer drive, but a major metropolitan area with multiple Costco locations.

For Aberdeen and Northeastern SD Residents

The distance from Aberdeen to the Sioux Falls store can be prohibitive for a quick shopping trip. For many, a trip north into North Dakota is a better option.

• West Fargo, North Dakota: Approximately 175–183 miles (3–3.5 hours driving).
• Bismarck, North Dakota: A competitive option, often cited in local discussions as a successful market that Rapid City is compared to.

For Pierre and Central SD Residents

Residents of Pierre, the state capital, face a difficult choice, often having to drive 3–4 hours to reach the Sioux Falls location, a journey of over 200 miles. This lengthy drive underscores why many Central South Dakota residents rely on local retailers and online shopping for their bulk goods.

The Future of Costco in the Mount Rushmore State

While the 2025 outlook for a second South Dakota Costco is not positive, the long-term potential for expansion remains. The corporate strategy for Costco is a slow, methodical expansion, prioritizing high-volume, high-density markets where they can ensure the success of their membership model.

The continued growth of the Sioux Falls metro area, coupled with the rising population in Rapid City and the Black Hills region, means that the necessary population and disposable income thresholds will eventually be met. Until that time, South Dakota shoppers will continue to make the long-haul drive to the single, successful Sioux Falls warehouse or cross state lines into North Dakota, Wyoming, or Minnesota to get their fix of the famous rotisserie chicken and bulk household items.

For now, the Sioux Falls Costco stands as a testament to the strong consumer demand in the region, a demand that is more than enough to sustain one location but has not yet convinced the corporate office to invest in a second South Dakota foothold.