Is Costco "The Anti-Walmart"?

According to MSN Money, discount retailer Costco is “the Anti-Walmart” for its quality goods at low markups and employees who are well-paid and have health care. From MSN Money:

This formula has generated fierce loyalty among both shoppers and workers while rewarding long-term investors…the company also has managed to make discount shopping fashionable for affluent Americans by offering fine wines, books and big-screen televisions at low prices, and staples such as paper towels and razor blades in bulk.

By offering one-time specials like discounted Prada bags or Callaway golf clubs at individual outlets, Costco has created what it calls a “treasure-hunt” atmosphere in its stores.

What do you guys think? Anti-Walmart? —MEGHANN MARCO

Costco: The Anti-Walmart [MSN Money]
(Photo: iBjorn)

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  1. bluebuilder says:

    I LOVE the Costco, except on the weekend at 1:00pm, freaken madhouse.

    I won’t touch walmart, and not because of their secret evil plans, but because their merchandise tends to suck.

  2. mconfoy says:

    I see no content on the link with Firefox 1.5.0.9, but given the site, perhaps that is not surprising?

  3. Kornkob says:

    @mconfoy: I’ve got the same version of FF and see the content just fine.

  4. Ass_Cobra says:

    One of the things that I missed since I moved is the Costco, and the space to store 24 bounty select a-size. I went through my last years expenditures and I’m dropping serious cash at CVS because I lack the ability to get to a costco and the ability to store the conehead quantities of household items. Also their beer prices were unparalelled in human history.

  5. billybastion says:

    we have something near here that walmart owns called sams club. im sure theyre everywhere else too, but since i live in the heart of texas, we dont ever get anything cool.

    i think sams club is basically costco, but owned by walmart. i wouldnt know though since ive never been to a costco, but i desire to do so.

    oh how i desire to visit costco…

  6. faust1200 says:

    Nice marketing gimmick. I’d sign up for cancer if it was considered anti-Walmart.

  7. Sam Glover says:

    The main difference between Sam’s Club and Costco is that Sam’s Club is owned by Wal-Mart. The deals aren’t as good, the employees are not as well-treated nor as happy, and it is in all ways inferior.

    (Disclaimer: I love Costco, although I feel awfully guilty buying their meat and produce, knowing where it comes from.)

  8. leftistcoast says:

    Costco is a great example of a socially responsible corporation, at least with regards to their internal structure and treatment of their employees. The problem is that a lot of the producers they source from are a great deal less so. It’d be nice to see Costco flex a little of their purchasing muscle and force some of their suppliers to be more like them. Of course, pressuring their suppliers would be taking a page from Walmart’s playbook, wouldn’t it?

  9. adamondi says:

    Costco is definitely the Anti-Wal-Mart. The fierce loyalty of its employees and members is just the tip of the iceberg. The only people I personally know that do not like Costco are people whose sanity is questionable. Pretty much everyone else I have known that has shopped there has always loved it.

    If nothing else, I really enjoy how Costco seems to actually value its members, since their membership fees are the main source of profit for the company.

  10. Skeptic says:

    Costco is better that Sam’s Club in a number of areas. One is that Costco consistently keeps its markups low in spite of Wall Street pressure to sneak up their margins. Costco caries a good selection of higher quality merchandise than Sam’s Club and Costco pays its workers better and treats them better.

  11. muddgirl says:

    One great thing about Costco is their customer-friendly return and exchange policy. Also, all the little tasty treats they give away while shopping!

  12. Rick Dobbs says:

    I think the Kirkland brand is probably one of the most quality generic brands that are out there. Though I do admit to not having tried the Kirkland Cabernet Savignon or the Kirkland Whisky.

    That being said, Costco can be hard sometimes because things you get used to buying and totally love just end up disappearing, never to be seen again.

  13. mathew says:

    Costco in Austin stock items from local vendors, too. For example, organic coffee from Ruta Maya.

    Only disappointment I’ve had was with the Kirkland brand dishwasher liquid. Not very good at all.

    To quote “Idiocracy”: “Welcome to Costco… I love you!”

  14. scblackman says:

    I agree. Definitely the anti-WalMart. Kirkland coffee is as good as any brand-name. In one Chicago Costo, the one on Clybourn Ave, they actually have a gi-normous coffee roaster and roast their own beans right in the store, which they then sell for the ridiculously low price of (around) $4-5/lb.

    I remember reading an article in the Wall Steet Journal, I believe, that Costco’s wine buyer is as good as any sommelier. Their wine selection at their Waltham, MA store is top-notch.

    I’m still aglow from picking up a pair of Lucky jeans for $39.95 last month.

  15. Boston Kevin says:

    I am addicted to Costco – it’s a phenomenal place to shop. The Kirkland brand contact lens solution (96 oz. for $7!) is the best deal on the planet.

  16. infinitysnake says:

    Costco RULES. I do most of my shopping there…and I have noticed over the years that it’s always the same faces..people seem to like working there.

  17. revmatty says:

    I’ve been a Costco member for a combined total of 10 years (5 in Missouri, 5 in California, with a break in between when I didn’t live near one for a few years). Their employment practices are a major reason I chose them. And with two kids it’s great to buy toilet paper, shampoo, and snack foods in quantity…

    All the Sam’s Club members I know are rabidly anti-Communistco (as they call it). Of course, the terminology should give you a good idea of their mindset. Their biggest gripe is of course the employee benefits when “that money belongs to the investors”. Also note Costco always does well in Consumer Reports.

  18. Nick says:

    I’m sorry, but for all the Costco fanboys out there: In two different cities I’ve belonged to both Sams Club and Costco. I’ve found the deals to be better at Sams, with more name-brand stuff and less “Kirkland Supreme” crap. In addition, the staff has actually been more helpful and friendly at Sams, despite being paid less (Since I don’t work there, the only way employee pay factors into my decisions is if I get better service as a result). Costco has also been tightening its policies lately, making Sam’s the better option. And since my friends with Costco cards are constantly asking me to get stuff for them from Sam’s Club, I’ve pretty much decided that Costco is very much overrated, and, at best, equal to Sams Club.

  19. Dustbunny says:

    @Sam Glover:

    Uh. Oh. What’s the story on Costco meat & produce? Those are 2 of the best things about Costco — the quality is always excellent.

  20. cbearnm says:

    Compare Costco with Sam’s not WalMart. You will find that employees are treated fairly equally at both warehouse stores, in both pay and benefits. The prices for items are very similar.

    The biggest difference I have heard is that Costco will take back virtually everything, but even that is being adjusted as they lose more and more money on returns.

    This is like comparing your local good Mexican restaurant with Taco Bell (or Del Taco, whatever). Or maybe Macy’s with the Dollar Store. To me, this is just another article to attack WalMart without making any real points to reinforce it.

    WalMart is making more profits (look at yesterdays numbers) in spite of the concerted efforts to diminish their customer base. WalMart addresses a need for decent items at good prices.

    I wonder why there isn’t the outrage at how the Whole Foods / Wild Oats purchase is their attempt to WalMart-ize the specialty market. In many markets, emplotyess get paid exactly the same as WalMart and benefits are very similar. Yet, people view them as ‘socially responsible’. Yet people will continue do slurp up the Michael Moore mentality when it is fairly easy to do real research (SEC filings, corporate reports, etc) that show the real story is not as presented by the media.

    I suggest everyone watch the South Park episode when a big box store comes to town and people start to boycott it. There is an important leasson there, as well as an accurate portrayal of human nature.

  21. cbearnm says:

    As far as ‘organic’ farming, has you ever checked the levels of heavy metals that organic farmers are allowed to use to compensate for not using insecticides. It will open your eyes.

  22. hop says:

    taint no costco down here on the eastern shore of md….we have a sams club…..it’s not bad, but have nothing to campare it with……costco used to be the price club in md….which was the last time i was a customer…….

  23. sp3nc3 says:

    @Sam Glover: Not to mention that for some reason, there always seem to be hot women working at the Costco near me.

  24. Greasy Thumb Guzik says:

    @scblackman: All the Costco’s have coffee roasters!
    But Clybourn has a couple of bike racks, Sam’s in Evanston has none.
    But I keep the Sam’s card so I can get in without a hassle just to get a hot dog there, same price as Costco. Of course the Evanston Sam’s always runs out of hot dogs, Clybourn never does. I was there when they opened one day & there were hot dogs ready!
    The only things that I need to get from Sam’s [with a friend's card] are decaf tea bags, Orville Kent cole slaw, & Sweet N’ Low, Costco doesn’t carry them. Costco doesn’t seem to be carrying any cole slaw right now, they used to have this awful stuff from Arkansas, then tried Orville Kent which is the best anywhere, but because hardly anyone knew they had changed brands, the Orville Kent flopped!

  25. MBM says:

    If it matters to you, buyblue.org reports that Wal-Mart’s political contributions break down to 78% to Republicans, 22% to Democrats; Communistco (hee!) donates 99% to Democrats, 1% to Republicans.

  26. BeachBumBill says:

    There are two differing marketing techniques between Sam’s and Costco.

    Sam’s uses the old time Sears model, where most of their products are aimed at price sensitive shoppers with just a few high quality (but over priced) items.

    Costco on the other hand, does the reverse. They have many high quality items and few low quality times.

    Me? When it come time to buy a new plasma TV, I’m at least going to look at Costco.

    If you see the Blount Lobster Bisque, buy it. It’s terrific!

  27. magic8ball says:

    One thing I’m able to get at Sam’s Club that my local Costco doesn’t carry is Tillamook cheese. Honestly, that was pretty much the reason I decided to go with Sam’s over Costco. Other than that, they look approximately the same to me.

  28. AcidReign says:

    …..I’ve got a Sam’s 4.5 miles from my house, Costco is 20 miles, and through a bad traffic area. That extra time and aggravation is worth whatever Costco’s price difference is. Sam’s stuff seems pretty much to be trusted brand-names, too. I’d hate to buy an econo-keg of off-brand coffee, and end up hating it.

  29. Demingite says:

    One downside to Costco: Because of the membership requirement, they keep a complete, cumulative profile on everything you’ve ever bought from them (including when and where), which is sold to spammers, and even political campaigns. You can opt out, but they intentionally obfuscate the opt-out information (small print, gray type), and you have to opt out every year when you renew your membership.

  30. dotyoureyes says:

    The other company I’d identify as the Anti-Walmart is Trader Joe’s.

    Great products sold at cheap prices, made with organic ingredients, and unique items you can’t find anywhere else.

    Employees are some of the happiest you’ll ever find, and they’re paid well.

  31. derherzeleid says:

    My only complaint about costco? it really is a treasure hunt to find the things you want. What I was able to purchase at my hometown costco, isn’t carried at the costco 10 miles away.. But you can’t beat costco’s food court, mmmm.. 1.63 “all beef” hotdogs

  32. Demingite says:

    Re dotyoureyes’ comment: I don’t know if the planet has a better, more brilliant retail company than Trader Joe’s. No club cards, no memberships, no coupons, no sales, no rebates, no crap. They use brains and empathy instead of gimmicks and manipulation.

    While Costco has its virtues, it is still light years behind Trader Joe’s.

  33. crackblind says:

    Anyone know how BJ’s compares?

  34. chickymama says:

    Love Costco. They demo enough food to make a good meal.

  35. formergr says:

    I totally heart Trader Joe’s! It would seriously factor in to future relocation decisions.

    I’ve been to a Costco once, and after all the raves I’d heart, I was a bit disappointed. Things weren’t quite as cheap as I expected, and the selection while good didn’t overwhelm me. Though I did enjoy the coffin display…

  36. cryrevolution says:

    @cbearnm,

    Lol…saw that episode…where the heart of the big box store is in the TV section. It’s stupid how many times I walk into a Wal Mart and quote that very episode.

    Love Costco. I have a friend who works there and gets paid very nicely. It’s a great workplace for college kids.

    K

  37. fencepost says:

    @magic8ball: Some Costcos carry Tillamook cheeses, because there are 3-4 different types available at the ones near me in the Chicago area – 2 block cheddars, a sliced cheddar and I’m not sure what else.

  38. Mojosan says:

    I (insert heart picture here) Costco.

  39. etinterrapax says:

    @crackblind: I have both Costco and BJ’s memberships (Costco 35 miles away; BJ’s in town) and while BJ’s won’t give you the treasure hunt, I’ve found that it carries more of my preferred brands, and more manageable package sizes for a small family like mine. I never did find anything all that astonishingly great at Costco, and BJ’s diaper prices are still insanely high compared to Target, but my feeling is that regardless of price, finding what I want in a size I can use is always preferable to settling for something else with a price offset in the drive. Costco’s other perk is wines, since they’re in New Hampshire (grocery stores can’t sell wine in MA without a special license), but I only buy more than one bottle at a time when I’m having a party, and that’s maybe three times a year, so I don’t count it. I have a package store half a mile away.

    I’ll drive the twenty miles to Trader Joe’s in a heartbeat, though. TJ’s and Aldi, same owner, aren’t so much the anti-Walmart as the hyper-Walmart, except that they treat their employees so much better. They’re the proof, really, that you can be a rock-bottom discounter without screwing employees or continually sacrificing service or the quality of your goods. Wal-Mart emphasizes sheer variety of goods, and it’s their undoing. They’d be better off doing fewer things well than everything shittily.

  40. Coronagold says:

    I say let Walmart be Walmart, let Costco be Costco. They both infuse $ into the local economy.
    Render unto Caesar what is Caesars’, and unto God what is Gods’.

    Shoot the rest, they’re just lawyers.

  41. Don Roberto says:

    The wife and I have been regulars at “the” costco (should be just costco, without “the”, as articles are generally not used with proper nouns, eg love costco or love the store but not love the costco) for the since we got married. She introduced me to it in her town of Albuquerque, and we shop at the one where we live now in Houston.

    I’m not one to fall for marketing gimmicks or whatever, but costco’s got me hooked. I really like that we see the same regular FULL TIME employees when we go there. I really trust the quality of the products we buy there. No regrets.

    Regular items for us include that big pack of TP, the organic soymilk (the 12 pack, not the three pack), eggs, and kirklands grape juice. I also love their men’s shirts (100% long staple cotton), and their italian wool slacks (great for work). We also fill up on gas there, since we go about once a week.

    Love the costco. Err I mean love costco.

  42. bokononist says:

    cbearnm: I have a family member who works at Sam’s Club. I can tell you with the utmost certainty that Sam’s Club does NOT AT ALL treat their employees with the same level of respect and pay as Costco. Not only is the pay low, but employees are not given employee discounts, and are only allowed one free membership. (Additional memberships can be helpfully deducted from your pay.) On ‘special’ items, employees aren’t allowed to purchase them, since they’re reserved for customers.

    Finally, and in some ways worst of all, they treat employees like juvenile thieves. Management does not cease ‘monitoring’ employee actions–both in-store, and those of their family members. They are treated with barely disguised contempt.

  43. velocipenguin says:

    @cbearnm: You must shop at some hoity-toity Wal-Marts. Every one I’ve ever been to certainly charges decent prices, but the products are abysmal. Wal-Mart’s skyrocketing profits are primarily attributable to reductions in employee benefits and their near-stranglehold on rural markets. Quality has nothing to do with it.

    @scblackman: $39.95 is a good price for jeans?! You must be joking.


    I haven’t been to a Costco since I was 8, but I am a happy BJ’s customer. Wholesale clubs are terrific for college households. I just wish they didn’t try to pull that receipt-checking crap – few things annoy me more than that.

  44. BobH says:

    Costco has another big advantage over Sam’s Club (besides treating its employees with respect and not just replacable morons): While you’ll often find crappy products at Sam’s Club, you seldom will at Costco. And if you do have a problem, their return policy is second to none. (About the only thing they’ve tightened up is people trying to return things three years later…)

    I can’t imagine anyone choosing to give their money to Sam’s Club/Walmart if they have a Costco nearby.

  45. DutchFlat says:

    COST

  46. DutchFlat says:

    COSTCO. Love/Hate. Great prices. Mostly quality merchandise. The Tire Centers are fabulous; great service, best quality.

    But, the lines at the register are often ridiculous. Sometimes, in Sacramento anyway, the lines go way back into the merchandise. They refuse to have a “Ten items or less” line. I inquired about this, and got this bullshit answer: “This is a wholesale buying service. We are only letting you shop here as a convenience.” When the lines get down to a reasonable length, the asshole floor manager will close registers. The “policy” (official) is that there will be at, what was it the manager told me? There must be at least four people waiting in each line.
    So, when it’s like that, I USED to fill a shopping cart with stuff, and then just leave it near the registers. Then I’d kind of sneak out of the store.
    Well, NO MORE! Now, I fill the shopping cart, and then I leave it near the registers, and then I find the floor manager, and tell him/her: “You see that cart over there, well, since you don’t have enough people to run your registers, maybe you can find some TO PUT ALL THAT STUFF BACK ON THE SHELVES!”
    Inevitably, they give me a bullshit apology. Fuck them. If everybody did what I do, there would be no more long lines a COSTCO.
    Oh, and their store brand peanuts taste like shit; they’re always stale. Sam’s Club sells NEW Planters peanuts.
    Now you know… Secrets of COSTCO.

  47. DutchFlat says:

    I just wrote about 500 words on COSTCO, and all that came up was the word COST. Shit.

  48. DutchFlat says:

    Ooops. There it is.

  49. DutchFlat says:

    ‘sorry.

  50. factotum says:

    Costco’s maximum markup is 15%.

  51. vanilla-fro says:

    The guy in the cubicle next to me has been able to return 2 laptops to them, one time while his receipt, the box, and the software was in Puerto Rico. The only problem he had the second time he returned one…it has Vista on it.
    I’ve never shopped there, but after he told me about that I’m certainly going to start. How can returns be so simple at one place and so impossible at others?

  52. coraspartan says:

    @velocipenguin: $39.95 for Lucky jeans is a steal! They are normally $100 or more.

    I didn’t realize Costco has such bargains! I have had a Sam’s membership for 5 years now and just renewed last weekend. After hearing about $39.95 Lucky jeans, I wish I would have switched over to Costco. Costco is closer to my house than Sam’s is, too. Damn!

  53. thesavvyboomer says:

    I live in S Korea and I think the Costco-Walmart experience here is indicative of the difference between these 2 giants
    When Costco first opened, the stores were empty, apparently because Koreans were not happy with the concept of buying a membership to shop in a discount environment because there are many large Korean discounters who do well with no membership fees. But Costco persevered, got the message out, brought in a lot of items Koreans felt were unique and interesting. Now, the store I go to opens at 9:30 and the 6 story parking lot is usually full by 10, 9 on weekends. It’s unbelievably busy inside the stores which are usually 2 stories of shopping-1 dry goods and 1 food. The customers are 90% Korean and the shopping carts are packed to the top. The food court is always a zoo and in general, Costco has quickly become a part of Korean shopping culture.
    Walmart opened with a flurry and the stores were packed because of their reputation in the US. But last year, they packed it in and sold out to a large Korean retailer and the brand is now gone. Another retail giant -Carrefour out of France met the same fate about the same time. I don’t pretend to understand why these 2 didn’t make it and Costco is thriving but I can tell you this: Koreans know value when they see it. Once something becomes “in” here, it has it made and Costco is extremely “in” in S Korea.

  54. I have a Costco membership, though I don’t actually get to use it often (we don’t have time/money/space, especially space). But I don’t even mind giving them free money, because they treat their employees well and all their products are not cheap shit from China. Those things count, dammit.

    (When I have gone there, I’ve found neat stuff and good prices and generally friendly staff. I don’t really like warehouse stores as a whole, but no complaints really. Oh–except their sushi. DON’T buy whatever brand that Costco sushi is. ::shudder::)

  55. Don Roberto says:

    YEAH, I love the lucky jeans they carry! The only thing I never buy there is fruit or perishable stuff ’cause it’s just two of us at home and the stuff ends up going bad on us.

    OH… and as far as the long lines… at our costco they’ve waved us over to the cigarrette counter if we just have one or two items.

  56. marqlet says:

    My family has been shopping at Costco since it was Price Club. Their prices are a steal for a large family living on one income. They really have a treasure hunt kind of vibe, b/c you never know if they are going to have Lucky Jeans, the new Prada bag or Wii’s.

  57. I wish I had a membership at one:
    http://consumerist.com/consumer/indoor-pool/costco-accepts

    ‘Nuff said.

  58. Citron says:

    I like Costco because they sell caskets and ship them overnight. That said, I’ve never been in one. I’m not a fan of warehouse stores because like RowdyRoddyPiper, I don’t have the space in my apartment to store a 20-gallon can of shaving cream. Or 20 1-gallon cans, or 40 half-gallon cans . . .

  59. Dont Know Me? You Are Me. says:

    Here’s another take on Costco. The small business I work for is a vendor to Costco. They carry one of our products as a seasonal in-store item and a few more on their web site. Of all the retailers that we have dealt with, Costco’s the best by far. They have the right kind of customer for our products, they are fiercely loyal to vendors who do a good job (when competitors use tricky tactics to try to make inroads), they don’t beat us up on price, they pay us within 10 days of delivery (most others insist on 2%/NET45 terms), and they don’t insist on a guaranteed sale. These are really important things for manufacturers like us.

    I only have two gripes. They have outdated systems that don’t allow vendors to see sales trends and historical info. Hence, the buyers we work with are not always eager to hear from us every week asking how sell-through is going. The other problem we have is that they ship our product returns (small electronic device) back one-at-a-time and we pay the freight.

    My wife and I are also long-time Costco members. The selection is limited, but in a good way. Costco is not always the cheapest, but they always have the best value; you get more than what you pay for.

  60. It took me a month to finish a wheel of Brie from CostCo. And a year to get through a box of Mentadent toothpaste.

  61. IRSistherootofallevil says:

    Since when does costco sell iMacs?

  62. Gondring says:

    @cbearnm: Funny to read about the problems with returns at Costco, since I was shocked to see the guy in front of me at the return line at Sam’s Club return “Quicken 2003″ without any questions. I asked about that when I got to the counter and was told that they knew it was old but they accept the return anyway.

    It’s also a ridiculous comparison between Costco and Wal-Mart, when it should be between Costco and Sam’s club.