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The move will be rolled out across the all 254 Warehouse, Warehouse Stationery, Noel Leeming and Torpedo7 stores in the country by the end of the year.
The compostable bags will cost 15 cents each except Noel Leeming, where they will be distributed free of charge. All proceeds made from the sales will go to charity.
This move comes off the back of Foodstuffs and Countdown's plans to phase out single-use plastic bags by the end of 2018.
Earlier this month, Countdown announced a batch of 10 stores that would have single-use plastic bags removed from May 21.
The Warehouse Group chief executive Nick Grayston sees this as an important step in the group's wider commitment to the environment.
The Warehouse Group has also installed electric vehicle chargers at stores around New Zealand and organises and manages The Great Community Clean Up.
Grayston said The Warehouse introduced a charge for checkout bags back in 2009, with net proceeds given back to the local community.
"Since then we've donated close to $4 million to support kids' sports teams, food banks, disability support services - grassroots community organisations."
"Now that we're including Warehouse Stationery and Torpedo 7 as part of this initiative, we'll be able to give even more back to the community."
Noel Leeming stores would offer a compostable bag at no cost.
The plant-based bags are designed to disintegrate in compost within 12 weeks with no toxic effect.
A survey of Warehouse customers saw 69% of customers say they would like to have some type of bag available, with compostable bags being the preferred choice.
This was seen as an option that was both environmentally friendly and convenient.
The Warehouse Group said it would also expand its selection of reusable bags. It used approximately 21 million plastic bags in the calendar year 2017.