Interesting article on Costco

JIM SINEGAL, the chief executive of Costco Wholesale, the nation's fifth-largest retailer, had all the enthusiasm of an 8-year-old in a candy store as he tore open the container of one of his favorite new products: granola snack mix. "You got to try this; it's delicious," he said. "And just $9.99 for 38 ounces."

http://www.nytimes.com/2005/07/17/business/yourmoney/17costco.html?_r=3&pagewanted=all&

 

When I lose my current job to budget cuts
( maybe, this coming year)
I'm going to work for THAT dude !
Thanks Joe

 

Love Costco! We shop there every week! Just received my annual cash back check = free membership!

 

And Costco is BIG on charitable works!

 

I know a young guy that works there and in the stock department, he works hard long hours, but supports a family of four through their pay and excellent health care. This is an example of why I dont feel sorry for business owners like that guy that owns Papa Johns, that is always complaining that the slightest economic shift causes him to raise prices. There is always a way as a business owner to do better without penalizing the consumer.

 

I think Papa John said paying for higher benefits would increase the cost of a pizza by $.08 each. Their sauce is too sweet anyway.

Thankfully, I was canned three years ago by a company that was a slave to Wall Street; employees, suppliers and customers be damned. The CEO closed a union plant because hourly wages were $.25 per hour higher than a non-union plant, despite almost no employee turnover and much higher productivity, quality and order fulfillment rate at the union plant. Since then, top end sales have been flat, they have grown profits through short sighted cuts.

CNBC frequently airs a show "The Costco Effect" which is worthwhile. Too bad the nearest Costco is 25 minutes away.

 

The Costco I use is 27 miles from my house. I know this because it's where I fill my gas tank & reset my trip odometer A

I'm very happy that this Costco is in between my office and my house and therefore I am easily able to shop there every week. Actually, it's right next door to my Kroger too, so on grocery nights (like tonight) I'll stop at Costco, then Kroger, then home - and I'll have everything I need for the week.

 

Our nearest Costco is now three times farther away. But since we no longer live in smoggy traffic-choked So Cal, the elapsed time is almost the same!!

 

I'm in Seattle, they're all over the place, it's great.

 

I've never been in a Costco store. Closest one to me is about 45 miles away. Never thought it was worth the drive to check it out.

 

Thanks Joe for posting...I found one just 45 minutes north of me....I'm going to check them out.

 

Just a FYI there is an annual membership fee. ~$50 I think. Or get an Amex card for $50 per year and that includes the Costco membership.
Also, Costco only takes Amex or cash, no other CCards. I'm not sure about checks, but I don't think so.

 

I don't think it's worth 45 minutes as a single destination. If you were buying something large that you'd be saving enough to make the savings worth the trip when also counting in the $45 membership, then maybe. But even then still probably only worth it if you were making some other kind of round trip with it.

See, for me, I've got one 10-15 minutes away, another 20-25 minutes away, and I think 3 other ones that are about 30-40 minutes away. Almost all of those are also near things I go to otherwise, from time to time.

One thing to know about Costco, though: It's difficult to compare prices with other stores since they often don't carry the exact thing another store will carry, and this is by design.

They'll have a manufacturer, say something fictitious, like Bob's BBQ sauce (there may be a Bob's, idunno, any similarities to are inconsequential to the story) come to them wanting to sell their products. The Costco buyer is interested, wants to carry their product. The manufacturer makes, say, 2 sizes of bottle, one is 12oz the other 24 oz, nice and simple. Costco may ask for a 2 pack of 24oz bottles, or some other size all together, and they may ask for an exclusivity for that size and/or packaging. They know about what other stores are paying for stuff, but since it's an exclusive they can sometimes use that to their advantage to negotiate a better per-volume price than another store (I'm not in that kind of business, but that's how it was explained to me by someone that used to be in that and seemed to be venting about it.) That also has the side benefit of making it so that a consumer can't direct comparison shop nor can they ask Costco to price match someone else's sale.

This practice goes all the way through electronics, even. Like a printer that generally isn't packaged with the USB cable, well, the Costco version might, or it might have different software, different color, stuff like that. Just enough to change the purchase to a different item.

This practice is also hell on manufacturers, who may go to great lengths to satisfy these demands for the opportunity to sell through Costco, only to be dropped a few months later when another brand comes in cheaper. Remember that savings to the customer thing in the article, that's a big part of their SOP. You can only be loyal to so many sides before you have to drop one, and the manufacturers seem to get the brunt of it (as hinted to in the article.)

 

I use my (Visa logo) debit card at Costco.

 

They take checks and debit cards.

 

Every retailer does this to avoid price matching, especially ones that deal in electronics. I remember getting into pissing matches with customers about not matching prices on computers that had a extra character in the model number and one software title different in the bundle that no one uses back in the old days. Retailers are a bit better about carrying the same item than they used to but even today shopping for cameras, I keep seeing models that Walmart has and no one else. I am sure it's the same story for a lot of the doorbuster TVs from last week.

 

BTW -
There is no Costco near me.
Walmart + BJ's + Sam's Club are near by.
I joined BJ's for the Baby Formula, Diapers + Wipes.
We also by Short Ribs + Chicken at very discounted prices.

 

I can't imagine it varies between stores, but last I checked, it was Amex only at our local store. We only have two in the entire state-so far.

EDIT: I was curious so I called our store. Amex only. Visa & MC are okay at Costco.com, but not in the store. I guess a debit card is considered to be the same as a check.

 

They take PIN based transactions on debit cards. So you can swipe your debit card associated with a checking account and use the PIN but not a signature like a credit card. I have used both a local credit union debit (Visa) and ING Electric Orange (Mastercard) at Costco.

 

The Sam's near me has horrible customer service - I've done the $10 holiday membership a couple times and my mom has occasionally had membership so I'll go with her. I like the BJ's warehouses but they are too far away from me for regular shopping so they're not cost-effective (but I'll do their trial memberships every so often, and again - my mom had a membership to one and we shared).

I would use any of them. I choose to use Costco because it's THE most convenient to my commute and it has the better customer service compared to the next most convenient.

Even though we're a household of 2 (+ a cat) it's still cost-effective for me to do a lot of shopping at Costco. It might not be for everyone. But you don't have to be a business or a family of 10 to make it work, either (we have the executive membership/Amex with cash rebate - I think the break even point is to spend more than $3000 a year? Which we do easily....)