What is making Costco so expensive?

[Anonymous]

Costco just passes on its own costs to members. Its profit is made mostly from membership fees, not markups on items.

[Anonymous]

Gave up our Costco membership years ago
We no longer have a need for bulk items.. plus the crowds and long lines were always simply exhausting to deal with.

[Anonymous]

>>>Some of the prices are exactly the same (I checked at Costco.com).

FYI, Costco.com prices are generally higher than the in store price.

[Anonymous]

What is making grocery prices go up is inflation and trumps tariffs and tariff threats. It’s not a store-specific issue.

[Anonymous]

Anonymous wrote:>>>Some of the prices are exactly the same (I checked at Costco.com).

FYI, Costco.com prices are generally higher than the in store price.

A lot of times the shipping is free, so I think they up the online price to account for that.

[Anonymous]

Anonymous wrote:They have the cheapest prescription eye glasses. Everyone in our family wears glasses. Savings from that alone more than pays for our annual membership.

Online stores (Chiiina) has the cheapest prescription eyeglasses.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I'm not sure I get this thread. Costco makes its money on the membership fees and sells most items at a very low gross margin particularly compared to WalMart or Target. That's not to say that every single thing is cheaper at Costco or that you cannot find a lower quality alternative elsewhere that will meet your needs but generally Costco delivers value.

Costco is a publicly traded company beholden to a Board of Directors and major shareholders. Costco, therefore, must squeeze out every dime it can, so if they have to charge $50 for a bag of pistachios and up the membership fee to $200 they will do so because the shareholders demand it to be so.

Costco is indeed a publicly traded company which means its financial information is public information.

If you think that Costco "must squeeze out every dime it can" from members, you frankly have no understanding of Costco as a company or what has made it a great business.

I promise you Costco is not squeezing its members making a mere $7 billion of net income on $250 billion of sales (< 3% margins) in 2024.

Especially because Costco is locking money out of the store by charging prices so low that they are so crowded that people literally can't get through the the store to get items and pay.

But maybe that's like the gym gimmic of selling memberships that they don't intend people to use?

[Anonymous]

Costco caps its margins to 14-15%. Like others say, they make the majority of their profits in membership fees.

the Acquired podcast about the Costco business model is fascinating, if anyone wants to geek out on it.

[Anonymous]

Anonymous wrote:You need to learn how the federal reserve works.

The Fed is currently holding interest rates (well, the one it has direct influence over) steady, despite calls from some quarters to lower it. Lower interest = higher inflation.

The Fed does not set or collect tariffs, which are what's currently driving inflation.