Costco is an upscale place to shop? I’ve never seen them lumped together with Whole Foods or even Apple.
Edit: Wow I didn’t realize Costco’s profit margin was higher than Whole Foods, Wal Mart and almost a full percent above Kroger’s.
Edit: Wow I didn’t realize Costco’s profit margin was higher than Whole Foods, Wal Mart and almost a full percent above Kroger’s.
A couple of factors act as a "filter" that makes Costco less worthwhile for lower income shoppers:
- Buying in bulk requires a bunch of cash up front, which not everyone has.
- Buying in bulk normally works best for families, and individuals with families have higher average incomes than those that don't.
- Costco stocks almost exclusively mid- to high-quality food and products. Shoppers may be able to have a lower grocery bill by buying lower-quality store-brand products elsewhere.
There are obviously individual exceptions, but these factors drive up the average income of a Costco shopper.
Also, for new parents: you can easily save the cost of the membership on diapers and wipes for the year or so your child wears them.
They always have a car parked in front or by the customer service center to advertise their auto purchase program. It has almost always been a Lexus, but for the past few months the one near me is a Maserati. I think this may be their signal on who their ideal customer is. Yet my parents used it to buy a Subaru and it was a good deal.
The concept is that when you decide against buying the $1,000 thing, the $50 thing seems a good comprise. If all you had were $10 things, the $50 thing would seem to be 'too much'.
You missed a big one in many areas: buying in bulk requires facilities for storing inventory.
Shopping at Costco is often a wise financial decision, and hence people who shop at Costco tend to be the type of people who make wise financial decisions, and the net result of making wise financial decisions is a higher net worth.
Costco serves the upper class.
Comparing the poor of a rich nation to everyone else is an apples to oranges comparison. The poop still struggle hard in the US.
There's relative poverty in the US still. Currency still has relative purchasing power. Saying a person living below the US poverty line should be put in the same class (upper class) as Jeff Bezos seems disingenuous as best.
You can also tag along with someone else that has a membership if they’re willing to offer you their time.
If you are poor to the point of relying on public assistance to meet basic needs, an extra $60 up front even if it will pay off over a year means foregoing other essential expenses now.
But the bigger cost in many parts of the country is the space needed for inventory to maximize the benefit of bulk purchasing. Sure it works well for my family, but we live in a decent sized suburban home with an second refrigerator, and a storage closet converted for additional pantry space.
https://www.fool.com/investing/2017/05/05/how-costco-wholesa...
> If you examine the company's sales, it brought in $56.59 billion in net sales with a merchandise cost of $50.21 billion and sales expenses of $5.92 billion.
I don't think that sales expenses would vary much depending on how many members were buying products.