Saving Money with Costco?
|This reminds me, I need to look at the size we have at home
and compare Costco's price to WalMart's.
This store has been in Canada since I was a boy. My parents, not wanting to pay the annual $55 membership fee, would borrow my aunt's membership from time to time and load up on bulk items.
Of course, I'm talking about the wholesale store Costco.
For years, I've deflected attention away from going to Costco.
We don't consume that much stuff.
They check for a membership card when you enter.
They don't have a Costco nearby.
Since we moved to our house 3 years ago, we actually live within 8 kilometres of a Costco. Hmmm... As such, the pressure continued to mount to visit one.
In the last two weeks, wifey was speaking with one of our neighbours. As they were speaking in wifey's native tongue, I only picked up pieces here and there. However, afterwards, wifey told me about the conversation. It appears they were talking about Costco and how the meats (among other things) were super cheap.
A few days later, we did a favour for the neighbour and she ended up gifting us a $50 Costco gift card*.
Seems if you have a Costco gift card, you don't need to have a membership. However, the only people who can buy or top up money in a Costco gift card are Costco members.
Armed with the gift card, we visited the closest Costco when we did our grocery shopping on Saturday. Fortunately, the Costco is across the street from a grocery store we frequent.
As we didn't know what Costco has to offer, this was mainly a reconnaissance trip.
We looked a prices of a few staples.
Milk was $3.95 for 4L. Buying milk at any other grocery store is around $3.97. As a result, we'd save two cents. To make back the money in membership fees, we'd need to purchase 2,750 4L bags of milk. Granted, there are other things at Costco.
Bananas were $1.59 for a 3 lbs bag. Bananas are generally $0.59 a lbs, so Costco was 6 cents a pound cheaper. That meant we'd need to buy 917 pounds of bananas to make the membership pay for itself.
Okay, we won't be buying 917 pounds of bananas a year, but if we split the bananas and milk, we'd only need 458 pounds of bananas and 1,375 4L bags of milk.
But seriously, we looked at some of their other offerings. Pork ribs were at least $3 a pound. However, when they are on sale at No Frills, you can get them as low as $2 a pound. Cooked whole chickens are $7.99 each. However, at Food Basics, you can get them for $6.99.
We determined that grocery items probably don't get that much cheaper from store to store.
Instead we looked at the items you can purchase in bulk.
Toilet paper was very cheap. Generally, the price of toilet paper should be 4 single rolls (or 2 double rolls) for $1 to be considered on good price. At Costco, toilet paper is 8 single rolls for $1.
Maple syrup can be purchased for $10 (there was that one time, it was $8 at No Frills) for 500mL. At Costco, the price was considerably less at around $15 for 1L.
Chewing gum, when it's on sale, is around $2 for a 4-pack at Walmart. Normally, $5 for 8 packs (or about 63 cents a pack) using their multi-buy special. At Costco, a 24 pack was on special selling for $10.79 (45 cents a pack) down from $13.99 (58 cents a pack).
A four pack of my deodorant brand, was less than $8. I believe I bought my deodorant from WalMart for $2.50. Although, how much deodorant does someone need?
In any case, yes. There are savings to be had. If you're a smart shopper, then you will save money at Costco.
However, the savings are generally a few pennies here and there. The odd thing you can get for a few dollars less, but only if you purchase a lot and spend more money than you need to. Sure, that pack of gum is impressive, you could save $3.20 from the Costco regular price. But if you compare that price to Walmart's cheapest price at 50 cents a pack, you'd save only $1.20. That's 1,100 packs of gum! Okay, I'll stop now... but that's still a far cry from the $3.20 you appear to be saving.
With very few Costco locations available, some people will need to drive longer distances to take advantage of the savings. As a result, the savings may be wiped out on the purchase of gas or wear and tear on your vehicle.
In short, I don't feel a $55 membership is worth it for a family of two adults. How much stuff can we consume in a year? Certainly, not $55 in savings to justify the cost of an annual membership. But then again, there is a lot of store to explore and we really only scratched the surface. Buying only groceries likely will not pay for the membership. However, there are a lot of other things like electronics and clothing that you can recoup your money with**.
However, with a family of 4 or more, I can see how a membership can be useful.
*For the record, I feel this gift we received was disproportionate to the favour we provided.
**Problem with wifey and I is that we don't really buy electronics just because. We only need to buy it if we need to replace something that is broken and we have nothing else we can use in lieu of the broken electronic. Clothing is another problem as a lot of the clothing is too large for wifey. She's an XS and most of the bulk undershirts and other clothing start from S. If my in-laws were with us, we'd probably get the money back in clothing alone.