Costco’s Love/Hate Relationships

Just about any day of the week you can find news columns and blog posts that either love Costco, hate Costco, or a little of both. Here are three examples from this weekend:

George Gombossy of the Hartford Courant dedicated his whole weekend column to telling us why he loves Costco, calling it the “Nordstrom of warehouse clubs):

Join people like me who have drunk the Kool-Aid and are card-carrying members of Costco, the Nordstrom of warehouse shopping.

All the major warehouse clubs — Sam’s, BJ’s and Costco — will save you money, but only at Costco will you and your money be treated the way you deserve.

Wow. However, he did have a few pet peeves:

Here’s what I don’t like about Costco:

•There are not enough Costco stores, especially in central Connecticut.

•Most everything you buy has to be in bulk.

•Stores open only at 10 a.m. most days.

•Limited merchandise, only 4,000 items per store.

•Merchandise that is there one week might be gone the next.

•Merchandise is moved around.

The last two are issues that really bug me. Unlike most shoppers of the opposite sex, my shopping is similar to speed golf. If everything is in its proper place, I can race through the store with a list of 10 items in less than 10 minutes.

They moved the Cheerios on me two weeks ago, adding several minutes to my shopping.

Now for a couple of dings by bloggers. The first one seems to be as much a product of Costco’s success as anything else. Joe Malozzi doesn’t enjoy Costco, but his reasons aren’t always Costco’s fault:

Now, I know you’re probably wondering “Joe, why do you hate Costco?”. Well, I’m glad you asked. Let me break it down for you:

1. The Parking: It’s like playing a live action video game as you slowly roll up and down the various aisles, desperately on the lookout for the thrilling sight of someone’s back lights, the telltale sign that a spot is about to free up. Since moving to Vancouver, Fondy has adopted the strategy of actually zeroing in on shoppers leaving the store and creeping along behind them, following them back to their car like some crazed stalker. If you’re lucky, they’ll lead you right to their parking spot, unload their groceries, and be on their way. But usually, you won’t be lucky. More often than not, the people you’ll be following will be octogenarians who’ll shuffle along at a snail’s pace, occasionally stopping to double-check their bill or adjust their pants before finally arriving at their destination – which, it will turn out, is not where they parked. At which point they’ll look around, gather their bearings, and cut through the parked cars to the next aisle where some other driver will luck out and get their spot.

And he’s got more where that came from, complaining mainly about the other shoppers using Costco as their lunchtime via the free samples, blocking the aisles, and questioning their hygiene:

Given the choice, I’m sure that fully half of them wouldn’t even bother to wear pants if they didn’t have to.

That’s just mean.

Now this blogger is a bit more diplomatic, a bit more reasoned, and a bit more love/hate. I think this is a really good analysis of Costco’s strengths and weaknesses. She begins:

What’s not to love about the place? You can get killer deals on cheese and meat, buy diapers and formula at a great discount and come Christmas time you can get half of the stuff on your shopping list from the toys they carry.

But then moves on to:

However, I’ve come to the conclusion that unless you’re a small business owner–say a restaurateur or espresso-shack operator, maybe an office manager–that Costco is pretty much the biggest scam ever put over on the American public.

I feel nervous about putting that in print, it’s kind of like saying “Children shouldn’t be taught to read” or “I hate puppies” and is sure to bring me gobs of fan mail but maybe after I give you my three big reasons you’ll think twice about that shrine you’ve held in your heart for America’s favorite warehouse.

She then offers some good points, one of which I’ll capture here:

Most staples such as bread and milk are at Costco about the same price as you find in other places–last week milk at Fred Meyer was $3.50 a gallon, bread $2.50. At Costco you’ll pay $6.84 for two gallons which works out to be $3.42 per gallon and bread comes in at $4.85 for two loaves, making it $2.42 per loaf. For our family that means if I buy my weekly six gallons of milk and four loaves of bread at Costco instead of Fred Meyer I save a total of $.80. Wow.

Even if I bought my milk and bread there every week for a year I only save $41 which might not sound too shabby but after you figure in the gas it takes for 52 extra trips to get over there–that’s like, what? $5000 in gas alone?–and the time spent in lines the savings is diminished significantly.

You might argue there are lots of other things that save you more money–say baby formula and diapers, prescription drugs or automotive items, things I rarely buy–but in general, for my every day, weekly shopping list items the prices I’m seeing on things like cold cereal, apples, rotisserie chickens, butter or pasta sauce really aren’t great. This is mostly because Costco tends to offer higher-end brands over generic. Sure, you’ll get the Kirkland Signature brand on some things but take, for example, the issue of canned tomatoes.

I can buy a 28-ounce can of tomatoes at Fred Meyer for $1.39 because I can get the Fred Meyer generic brand but at Costco the only brand they carry is S&W which is always more expensive–even at Costco. I’m paying more for tomatoes but my mind gets twisted into thinking that I’m saving money because I’m buying a brand name product for less than I’d buy a brand name product at other places. Problem is, the brand name products are rarely better, they’re just brand name. I don’t need Gucci tomatoes folks.

They may have a love/hate relationship, but I don’t see them giving it up.

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