A warehouse club is exempt from registration as a retail food establishment if it sells food
products directly to consumers as its primary function. A retail food establishment primary
function is to sell food directly to consumers if the annual monetary value of sales of food
products directly to consumers exceeds the annual monetary value of sales of food products to all
other buyers. Businesses are not considered consumers. Thus, if the annual monetary value of
sales of food products directly to businesses exceeds the annual monetary value of sales of food
products to consumers, the warehouse club must register (21 CFR 1.227).
