Costco Capitalism
bryanlehrer.com
bryanlehrer.com
The mantra I heard, over and over, while I was there was "Hire good people, treat them well, and the rest takes care of itself."
I'm always amazed by how many places cut corners on employee benefits and pay and then spend endless effort dealing with turnover and the results of poor employees.
Excrement flows downhill.
That said, they aren't a tech company so...
I would absolutely believe that they don't want to try and compete with the tech sector for talent, and their management doesn't have the same understanding of tech that they do of running a warehouse business.
I've worked in IT for the retail sector and I'd never, ever do it again. I was a Dev/System Admin/System Engineer/DBA/Network Engineer & Help Desk person. I needed a job rather desperately and took the first one that was available to me which at initial view I thought was promising.
As an example, if you worked on call which was restored 1 in 3 weeks, you didn't earn anything extra in wages on the days you were on call. But instead I earned 0.5 hours of TOIL for every hour that I was restored on which was from memory. 07:00-20: 00 Saturday, Sunday and Public Holidays. And 07:00 -> 09:00 and 18:00 - 20:00 Monday to Friday.
I would get calls at all hours because we supported retail stores in New Zealand, Australia, US & Canada. We had local staff in those areas but for the gaps in follow the sun support we had the on call person fill that role.
This might have been a good deal if you didn't get many calls. But for the larger part it was a full time day of work on Saturda, Sunday and Public Holiday when _no one was working_ except the on call person. And on an evening and first thing in the morning for shop close and open you frequently got calls before and after your shift started. All for 0.5 hours for every hour worked!
This doesn't even begin to cover the problems we had with retaining staff (understandably) and an absolutely awful work environment. My manager did his best to foster a positive work environment but the C levels clearly had no desire to do anything but bleed their staff dry.
Wrapping up my tirade, it wouldn't surprise me if this was the standard across the retail industry for IT staff and developers. Based on those I've spoken to outside of my own personal experience, this seems to be close to true. For all the glory that Costco holds for paying higher than average wages, I'm certain their IT department fucks over it's staff in a way that closely resembles my own.
Also, to be clear, your experience was working in IT at another retail company, not Costco? I'm not sure why you would expect these to be the same: as the article explains in detail, Costco's model lets it do some things very differently from, say, Walmart.
I didn't work in either of those chains. I'm replying to a comment directly above mine where OP says, they knew some one who worked in IT for Costco and their conditions were terrible. As was mine for another large, multinational retail chain.
Costco are great in comparison to say, WalMart or Kmart/Target/BigW in Australia. But I assume they're under the same pressure to penny pinch as any other retail organisation because of their incredibly small margins for profits.
[0] https://www.thestreet.com/technology/costco-thanksgiving-day...
Trying to opt out was futile. Each message had an unsubscribe link. The landing page worked, but whatever was supposed to handle the form time out or 500'd each time. Hold time at the Costco call center was 10+ minutes... to unsubscribe from opt-out garbage. Unsubscribing from the membership itself was a bit of a comedy routine where the manager kept suggesting I keep the membership and patronize their warehouse (instead of the one I signed up at).
It's fair to say I agree that Costco would reap benefits by investing in their IT infrastructure.
That's an old myth.
Because of COLA (and on top of that, pensions), the public sector in California pays more than private jobs now, aside from FANG.
I once asked my dental billing technician (yeah that's really a thing in the USA), "Who got the best benefits?"
Answer: "Oh, public employees are royalty."
As an example here's a senior (1043) network engineer position with the SF Dept of Technology:
https://www.jobapscloud.com/SF/sup/bulpreview.asp?R1=PEX&R2=...
Salary is listed as:
$59.49 - $74.83/hour; $10,311.00 - $12,970.00/month; $123,734.00 - $155,636.00/year
I can tell you that a few years ago at megacorp (not FANG) my base pay for principal ops monkey was more than the top end of the 1043 and 1044 scales. We were not known for above average compensation. In general while we hired into the principal role I think the city tends to aim more for senior (1043) than principal (1044).
Here's the SF pay scale database:
Principal programmers (1064) top out at $149k. Infosys managers (1071) top out at just under $200k. That's not particularly competitive.
Megacorp also provided me with the best 401k I've seen (Vanguard with access to institutional shares), 401k match, stock options, and decent insurance.
I once asked my dental billing technician (yeah that's really a thing in the USA), "Who got the best benefits?"
Answer: "Oh, public employees are royalty."
This still matters so much more for unskilled labor. Working in tech you're already going to have access to heavily subsidized health insurance. 401k vs pension is a matter of debate. I'd prefer a defined benefit situation like a pension, but a 401k with a decent match (we got up to $7k or so) isn't really a deal breaker
The city (due to some combination of local, state, and federal laws) will dock 2% for retiree health care, and 7.5% for your pension.
http://citidex.sfgov.org/cgi-bin/dhr/findClass.cgi?class=&ti...
Someone has to hire the bad people.
Unless they are _literately_ unemployable, in which case we should consider them disabled at look after them as if we would anybody else with metal or physical disabilities.
Why? People shouldn’t be rewarded for being disagreeable, unwilling to get along with people, and unwilling to work. If they are literally disabled and can’t work at all, that’s one thing. But even people with mental disabilities can be great employees. Rewarding anti-social behavior with “looking after” incentivizes such behavior. Subsidize behavior and you get more of it. Case in point, all of the fake disability people who have unverifiable soft tissue “injuries” that collect disability as a life choice.
And where is the role of the employer and the overall culture in fostering a work environment that isn't miserable?
How many will decide not to contribute?
I don't want to work with people who are working just because they are coerced to work. They get in my way and it debases all of us.
On the other hand, since failure to participate in this model - again, wherein a given individual hardly contributes directly to his own survival, but instead supports the society which provides the rest for him, usually far below the value of his work for it - is an existential danger, I think coercion is a fine word for the situation.
Except the part where simply choosing not to subsidize someone that could contribute to society but does not involves no actual use of force.
On the other hand, using the state to force a productive minority to slave away for a willfully unproductive majority does actually involve the use of force.
You are literally inverting the meaning of "coercion". Hence the apt description "Orwellian".
War is Peace, Freedom is Slavery, Ignorance is Strength.
Of course it does. What are the various exigencies, used to secure hoarded property for an individual against a deprived public, but force? You're unable to see it as such, because it's the status quo, but it's not a necessity for a civilized society, even this civilized society.
Given that I find what you propose to be so anathema, I feel compelled to clarify what your position is, in case our disagreement is resulting from a misunderstanding rather than a conflict of visions.
What I hear you as saying is that given the wealth available in our society, those who do not wish to work (even if they could) should not have to. The minority who do wish to continue working shall hopefully be productive enough to continue to provide this wealth (and indeed, increase the wealth available) and gladly share it with everyone. If the productive minority are less than willing to share the bulk of the fruits of their labor, It is acceptable to take it by force and without offering them something of value in exchange.
Such a system not merely immoral but nonsense. It assumes our great wealth as a given, when it should be obvious that such is not the case. History has shown many other times of great wealth and surplus, only to be followed by collapse. There is no magic line of societal wealth that, once surpassed, renders us immune from disaster. In such a case, those in who lived in a state of dependence will only hasten the collapse by trying ever harder to extract from those they depended on.
Now, if you were a Marxist concerned about workers not being compensated fairly for their labor, or a Christian concerned for those who could not care for themselves (the elderly, the infirm, orphans, etc.) then I would at least understand. But neither Marx nor the Apostles envisioned a society that supported people who were merely indolent.
Furthermore, that you would equate the use of force to steal another's property with the force used to defend said property is dishonest and abhorrent. And let's be clear: if you appropriate someone else's property when you have the choice not to (i.e. if you could work to provide it for yourself or offer something of value in exchange) then it is theft.
And for those people who's labor is pointless, the solution is to have more meaningful work, not idleness.
I can think of no more pointless form of labor that to toil away for whatever bureaucracy that would be responsible for administering this harebrained scheme.
That said, there is still an element of will there, and we should also still try align incentives to give these individuals the best chance of productive engagement with society. The disability scamming is real (though somewhat complicated by the fact that long term unemployment can result in chronic pain symptoms).
I don't think just cutting people a check is necessarily a good idea. I kind of wonder if the problem of unemployable people would be reduced if we removed minimum wage laws.
W. Edward Deming and the Toyota model he inspired demonstrate that it’s more about empowering workers, treating them with respect and autonomy, and respecting their contributions for what they really are, as opposed to ascribing them to management. Go read about what Toyota did at the NUMMI plant if you need further evidence of this.
It seems almost obvious this holds true for any job, including Costco, where perhaps someone isn't fast or personable enough to be a checker, but they'd be great driving the forklift. Find the right environment and suddenly they shine. There will always be a percentage of the population that is unemployable for some reason, but my personal experience is that it isn't as large as is often believed.
That said, this is not a random distribution. Some people have serious character flaws (evil, lazy, angry), or are just not very competent at anything. If all organizations only hire "good people", these will be left unemployed.
And here's the thing:
Those unemployed underskilled "bad people" are then an underused resource, and a reasonably functioning labor market will find way to make use of them.
I think of things like fast-food restaurants as a real triumph in this area! That industry has found a way to run a well functioning business using barely competent people who often quit within months.
And that's pretty much what I had in mind when I wrote my tongue in cheek comment.
BTW, my apologies to current and former fast food workers. I know you're not bad people :) But when you argue about those left out "good people" policy, you kind of have to use that term...
Most employer-employee relationships [in the US, anyway] are akin to serfdom, or some other weird form of drastically-out-of-whack power structure. Employees often aren't treated as equals, they're not given agency or power, their needs and desires aren't understood, and they aren't inspired by a common cause. So unless an individual takes it upon themselves to suddenly do the best job they can possibly do, they will flounder in their own little world, being largely ignored by management (until they're not meeting some ridiculous arbitrary yearly goals that are mostly designed to cull the completely apathetic) and never having any interaction with executives other than the way a king would give proclamations to the townspeople.
To me, "treating people well" means treating them like people who have a say in what they do and how they do it, by helping them do the things they want to do, by connecting them to their work, giving them pride and purpose, feeling valued and compensated. After that, the rest takes care of itself. But getting to that point is impossible if management treats them like cattle.
That is, in my experience, how a lot of brick&mortar commodity stores - grocery stores, clothing stores, etc. - run in my home town (Kraków, Poland). The infinite source of disposable workers is the population of fresh undergrads that come to the city to study.
https://www.amazon.com/Destroy-Tech-Startup-Easy-Steps/dp/09...
And the quality advantage, and even parity on selection. And the grocery chains don’t know why they keep losing money in their race to the bottom.
Arbitrarily set and static point of reference can solve it e.g. a bible or a well though out system. I don’t think the former is the CostCo’s thing so I’m wondering what would be.
There were some people I thought were lazy, but many people on my night shift were hard and proud worker.. not like that day shift though!
Maybe we should have them take a shot at running the DMV, who have the most miserable.
Minnesota is the complete opposite. Walk in, wait an hour, every employee hates their job, then wait a month for the new license to come in the mail.
Costco employees, honestly, not helpful at all and almost always disdainful of being asked any question. I guess that's not their model.
I suppose Costco employees can be happy with the company, but not happy and friendly to the customers, in which case, that holds up.
Just because an individual or a company is perceived as disagreeing with your personal beliefs doesn't make it 'bad'.
CF happily sells its delicious chicken to everyone irrespective of their sexual orientation.
Knowing which day you’re off lets you plan.
You may have 2 days off but your friends and family are likely working during the days and in "nothing too exciting" mode in the evenings.
The benefit of everyone having Sunday off means that (for the most part) the rest of the world also has Sunday off and you get to enjoy time off with your friends and family.
To imply something is 'tainted' by its religious inception is a kind of bigotry, moreover, it misses the point entirely: it's the very reason the company is ethical, or communitarian in many ways. Of course, even the very nation, or more broadly 'The West' is fundamentally Christian (or better described as mostly 'secular Christian'). Everyone has healthcare in Canada due to the 'Agrarian Left' which is essentially a brand of Christian Democracy. The same goes for the vast majority of Western institutions that were created more than a generation ago, including most Universities etc.. Consider that there might be more complexity concerning social issues in this world such that anyone with a voice mightn't be always playing favour specifically to you or your version of the 'morality'.
No.
Advocating for/against gay rights is a spectrum, and you need to see where they fall on it.
Tolerance is a 2-way street.
Not advocating FOR gay rights isn't a moral failing. But that's irrelevant for what Chick-Fil-A are accused of (and frankly a straw man).
Advocating AGAINST someone else's rights or freedoms, even when those rights have no impact on your beliefs, is a moral failing. That's what Chick-Fil-A is doing.
So, no, it isn't a "2-way street" when one side is just asking to be treated equally and the other is asking that OTHER PEOPLE are treated like a sub-class of people.
When I say that being against gay rights is an immoral position, it does not mean that a person is immoral, because that is an ill-defined phrase. It means that in the context of their speech and actions on the topic of gay rights, they are behaving immorally.
I agree that there is a spectrum of beliefs, and that it is necessary to meet somebody where they are. Each step is an important one, and beliefs change slowly.
Where I grow angry is when it is implied that Christianity is inherently and irrevocably against gay rights. Where I grow angry is when it is implied that all Christians must be similarly against gay rights. Where I grow angry is when it is implied that my faith must be a tool for bigotry, rather than an instrument of community.
There are many denominations that LARP as Christian, Jew, or Muslim while advocating for gay rights, but they accomplish this by discarding large parts of their holy texts.
[1] For purposes of this discussion when I say "choose to be homosexual" I mean to choose to perform homosexual acts, get married to someone of the same sex, etc. I don't mean it in the sense of whether or not feeling homosexual desire is a choice.
- One could believe that, by making man in his own image, God desired that men be able to make their own decisions even if those decisions sometimes displeases him and/or they will eventually answer for.
- One could believe that a free society ultimately allows one to better accomplish God's will even if it also means that people are free to do things that you don't agree with.
- One could feel that, since humans are imperfect, it is possible that they will misinterpret scripture or apply it unjustly. Therefore, it may not be safe to force people to follow a given way of life.
- One could feel that judgement is the sole domain of God and therefore human law should not seek to enforce purely moral issues.
Additionally, it's not that they don't advocate for gay rights, it's the they actively fight against them. I think this changed very recently, but it has been the case most of their history.
That said, I'm of the mind that most large corps do stuff that is against human rights in one way or another - sweat shop abuse, crushing of labor unions, among many others - and purchasing from Chickfila isn't much different from drinking Coke or buying Nestle. It's part of society. If you avoid corps with rights abuses you must avoid nearly everything.
It’s a wedge issue used to whip conservative voters, not a moral issue. Nowhere in the Bible does it say you must fight to prevent heathens from filing taxes jointly.
Is "should pedophiles be legally allowed to have sex with and marry the people they are attracted to" a moral issue to you? I mean, the kid consented!
Yes, most of us would say that's different. But why it's different is a moral position - and so to some people, it's really not different.
(Also, "the correct answer isn't a moral position, while the incorrect answer is an immoral position" is a bit of a contradiction. If "gay people shouldn't be allowed to marry" is an immoral thing to believe or act on, then you're acknowledging the choice of positions as being a moral one. "I should be able to kill all the people I see" is also a moral position, of course)
The reason men must be able to marry men is not a moral rationale, it’s a legal one. There is a well established legal doctrine that says you can’t make laws that discriminate on the basis of sex without some sex-based reason.
There’s no sex-based reason for why I should be able to have a woman at my side in the hospital but not a man. You don’t need a womb or breasts to to speak to the doctor on my behalf. That’s ridiculous. If my sister can choose to have a man by her bedside, so should I be allowed to. That’s equal protection.
There is no similar protection for children. Literally no one is able to choose a random 12 year old boy to make decisions for them in the hospital. And that’s fine because there is no equal protection for kids. Nor should there be. They are legally wards of their parents, not adults. They very intentionally do not have the same protection under the law that their parents do.
None of this has anything to do with morality, it has to do with equal protection under the law.
Morals and legality are different. Marijuana is federally illegal - does that make it immoral to produce/distribute/possess/consume? I would say no, and a large part of the country would say the same. Similarly, I think a ton of people would freak the fuck out if the supreme court legalized marrying prepubescent children - it might now be legal, but that doesn't make it moral.
The moral position that people fighting gay marriage have is that the current caselaw is wrong, and that equal protection shouldn't be interpreted that way.
I've been trying to explain how it's a moral position for some people, in response to this statement of yours. I'm not sure how to make that argument in a way that would be convincing to you, in large part because it's not convincing to me.
And I suppose we may be getting some wires crossed - for a lot of people in the world, there doesn't have to be a justification for a moral belief - or at least not one you would accept. "My religious authority told me" or "my parents told me" might not be as acceptable in the society we live in today, but they've all been extremely successful throughout history.
There is a bizarre social situation going on where it seem Christians who only _morally_ oppose LGBTQ are being targetted uniquely.
And the argument that you have some exception that proves the rule but you can’t name it is bogus. Either you know deep down that it is false and/or propaganda and nobody will buy it or you are making it up and there is no such example.
Google for group, country or religion that kills homosexuals today. Now compare those groups to who you criticize.
If all of them are Christian groups, I stand corrected.
If any of them are non-Christian, will you openly name condemn that group/religion/country/race? I doubt it, you will be voted down to oblivion here.
Edit: Just _mentioning_ that someone else besides Christians are attacking homosexuals gets you a downvote.
This is a topic worthy of open discussion, so why can't it?
LGBTQ are being _killed_ in many places around the world, and will continue until the focus is properly adjusted to the real culprits.
Personally I believe Christianity is an oppressive religion that needs to go away. It does more evil than good in the world, especially in the US and Easter Europe. That does not preclude me from condemning groups like ISIS or Saudi Arabia’s government for their actions.
Every religion is oppressive if you don't agree with the tenents of the religion.
The fact that you aren't against all religions reveals your true motives.
Even something as seemingly universal as the Golden Rule is incompatible.
In-N-Out, Costco, and Chick-fil-a employees all seem to work really hard and are unfailingly good with customers. I had a problem in a Target once, talked to an employee about it and he went to 'check on it' and never came back. Just left me standing there.
More generally, workers take care of something as if it were their own when they have an equity stake in it because it is (partly) their own. Just being treated well isn't enough of an incentive to go the extra mile when they have no connection to the profits, only laid-off when the business declines. It seems foolish to be content to accept benefits that most every other industrialized country on the planet already guarantees as a basic right. I think an uncomfortable truth is Americans don't know how bad they have it, and shouldn't sit back while corporate investors amass trillions on their backs, no matter how well or badly they are treated. They are being cheated only because of their failure to get organized and push-back together in some fashion and failure to demand UBI by taxing corporate profits made off automation, longer hours and productivity increases. At some point, if reasonable assistance isn't offered to those who's survival seems threatened (marginal propensity consume is 1.0) and have nothing left to lose, there will be more mass shootings, homeless encampments will expand, more internal migration, less average purchasing power, and more people flamewar-ing in Youtube comments.
This makes no sense whatsoever.
Honestly I love this about Costco (and especially Trader Joe’s).
I want them to do a little research and taste testing and stock the item that they think is the best quality and value. I don’t want to crapshoot between 6 different brands of spaghetti.
Trader Joe’s also does a great job at this. It may not always be objectively the “best” item, but it’s usually good and they’ve built up trust with me that gets me to try new and potentially expensive food items.
Trust in quality, Trust is service, Trust in prices.
To the point that when I need to buy quality stuff at good prices and avoid doing lenghty research to filter out scam, fakes and crap (aka: Amazon, Ebay and their little siblings) - Cosco wins.
There is no other business where people come in with an intention to buy $50 worth of stuff and then consistently spending 5-10 times more each and every time.
Fun fact: It took me 10 years to stop calling it "Price club"
Amazon used to be that around 2013/14, but now I prefer to spend more and buy things elsewhere because I don't have to do so much research to make sure the product doesn't suck.
(As long as they didn't link to Amazon, it's not safe to buy there.)
IKEA
But I’ve definitely returned food that I didn’t like.
Once they even let the guy in front of me return an empty container. He said he had to eat the whole thing to decide he didn’t like it.
I was so disappointed that Costco had sold me something so subpar I returned it. I don’t know what they were thinking.
Doesn't get better than that.
The absolute key is to eat BEFORE you shop, because otherwise you end up with at least 30% more food that you probably wouldn't get if you weren't hungry.
A quick ranty list of complaints:
The store is too small for the amount of people and the enormous carts. It is a game of bumper cars every time.
Similarly, more than once I had to give up since the parking lot was completely full and I could only take so circling the lot. The gas lines are reminiscent of the pictures from the ‘73 oil embargo.
The location of items and item selection changes constantly.
There is few staff available to help you find anything.
The free samples attract hangers on like moths to a flame, blocking traffic. People treat the samples as a free lunch for their kids, and let kids ride unsafely ride inside the cart and not in the cart seats — no one stops this.
I have more, but writing this is already getting to me.
Every where else I have been, Costco is great. The store is never packed, even if busy at times. Checkout lines never exceed 5-10 minutes. Gas lines rarely exceed 10 minutes at the busiest of times.
I prefer to go during lunch hour or after work.
Besides that, I like what I have heard from employees, they are very happy, the salary is far higher for the same role than on different stores, and I have heard that jobs are costco are very useful for students because they help you to find an schedule that doesn't conflict with your school.
While people claim that costco has cheaper prices that other stores, that's not 100% true on Mexico, I can get several items for a smaller price (most of them aren't that cheaper) but costco gives me confidence on the details I posted above.
I would love to see more stores following its good practices.
...so that consumers buy more/are more likely to buy, making them more money. Which is kind of the point of the article.
The relentless focus is on customer satisfaction, nothing more. They want you to come back next year. That's it.
Volume is essential to their profitability, and not just because it's what justifies membership for customers; they are unit profitable on sales, but without sufficient volume that wouldn't offset fixed costs.
If you aren't buying anything else, you might not need a membership.
The original article brings up the trust consumers place in the products Costco decides to sell, and the Wavestorm is a fun example of one such Costco cult.
https://www.newyorker.com/sports/sporting-scene/the-cult-of-...
I hear their Vodka is really great too.
And frankly, it's absolutely worth it. You pay for something like Prime, and before they expanded it to include Video and Music, you were essentially paying for slightly faster delivery and less things to purchase upfront.
Costco's model is all about giving you access to the best VALUE. They do really sell very very close to wholesale prices and many things are sold at cost.
Will they ever be the size of Amazon or Walmart in revenues? Probably not. That's not their goal. By having a membership, they are mostly targeting a demographic with something above $0 spending money.
Costco is all about slow and sustainable growth, although who knows. Their target market is quickly dwindling so they will eventually need tor raise membership fees to increase revenue and profit.
1. Low variety of items
2. Quality items
3. Low price items
4. Extremely beneficial return policy
I tried em all, Costco, BJ's, Sam's Club, Aldi, Walmart, Target. Nobody can tell me how it is, I've actually tried it and Costco is by far the best place for my family to shop. Want a raincoat? Oh yeah rainy season they had a North Face beautiful blue jacket for $80.
I will say their bedroom sets are shit. Buy their cheap sets if you must, their premiums are terrible.
Bought some Aldi sushi and got sick to my stomach, just nasty cheap salmon cuts, with nasty cheap rice. Mealy and tasteless.
With Costco it's quality all the way, 4 years literally never bought something of poor quality there.
I'm mostly asking because I grew up with the German grocery landscape which has been shaped by cutthroat competition from Aldi and Lidl for decades.
Walmart famously couldn't hack it in Germany.
The UK Costco’s are a poor imitation of the ones I enjoyed in Canada. Even thought the layout and the idea are the same.
Not sure why tbh.
I regularly go to Costco here in the UK. It's almost always busy, checkout queues are long (but move quickly).
Their petrol station used to be reliably cheaper than everywhere else near me, but they changed supplier and now it's the same price as Tesco. So I go to Tesco, as it's 99 RON and I get clubcard points.
For me (single) Aldi is a better deal. Costco-sized packages of food are just too much when you aren't raising a family, and I can't justify the membership fee.
Yet another example of how just being a good company gets you free advertising.
I basically just consumed a 10 minute ad, and enjoyed it, and now want to go buy a pallet of something from people who I now assume will cheerfully applaud my gluttonous purchase.
I live out on the rural outskirts of a central European city, into which I regularly commute for work and life.
I'm often very amused at the city-dweller point of view. These are people who live surrounded, in geographically aligned order, by about 1,000 other people, on average, within a block. They're stacked on top of each other, a literal hive. Public transportation is superlative, but the city was made for horses, something that hasn't changed much.
The effort required to walk down the block to a Billa or Aldi is often far, far too great for these denizens. Actually, as a whole, city-slickers require far too much motivation to escape the zone of their immediate comfort level. It gets so cozy.
Out in the sticks, nothing at all is thought of a 20 minute walk to pick up a jar of honey, a bottle of milk or a bale of apples. Alas, city-slickers take so much prodding to get out of their city these days.
But, in the sticks, we do have a Costco equivalent. I can honestly say that I use it quite a bit to keep the house stocked with necessities. I often see business-owners from the city shopping there, though .. ;)
My personal strategy so far has been to encourage some ethical consumerism by example, not because that directly increases the share of ethical consumption significantly, but because I think that attaching ethical considerations to an action as common as consumption will, down the line, also encourage people to vote in line with that. In the end, it currently seems to me like regulation is a required part of upping our collective standards and impact.
What exactly am I missing here? The Channel conflict model seems to be about maximizing revenue by not selling the product to the customer and ignoring new channels.
Not selling can boost short term revenue but it's a risky move when your competitor is Amazon.
Their Kirkland brand is always good quality and has never let me down unlike other homestore brands.
As a Brit another thing that makes it appealing, is for us, it seems like the "American" shopping experience.
Going to Costco is like an adventure trip/excursion. Compared to ASDA, Waitrose or going into the city to shop.
The entire concept is optimized for upper middle class suburban families with cars. Once millennials age into middle age over the coming decades, will they have kids in the same numbers as their parents (data says no) and thus need or want to buy in bulk? Will they live in the suburbs where warehouses are primarily located? Will they have cars to even get there? Will they want to pay for a membership when they already have Amazon or wide availability of other stores that deliver for free?
I'd predict not in the same rate or numbers as boomers or Gen X, and imagine Costco would need to transform several aspects of their current business model if they wanted to stay relevant 10-20 years from now.
Where are they going to live?
https://www.census.gov/newsroom/press-releases/2015/cb15-33....
https://www.wsj.com/articles/ok-boomer-whos-going-to-buy-you...
This is also the continuation of a trend started by gen-x, so they aren't going to "grow out of it".
So for people to move to the cities, it's either stack up and share a flat, or other city dwellers move out.
Both things are happening. (And a bit of growth in residential space as well, but not nearly as much as there's demand.)
My girlfriend and I are millenials with no children. We still have a Costco membership. Hell, I had a Costco membership before I met her, when I lived alone. I buy all my gas at Costco, and the savings alone from that usually equal or exceed the $60 membership dues by the end of the year, so everything else is pretty much gravy.
going to Costco as a single millennial is basically a hack, not the target customer at all
Like, why would I not have a car at middle age? I'm still working for another 30 years, at least. If I didn't waste my twenties moving to a big city, living in a studio apartment, and ditching my car to ride the metro, why would I start now?
> going to Costco as a single millennial is basically a hack, not the target customer at all
So, admittedly my understanding of Costco might be out-of-date, but once upon a time the Wholesale Retailer's job was to sell you stuff at basically the same price they get it from the vendor, such that their margins are low or nonexistent--their revenue comes from the membership dues. They might have their own in-house brand so that they can get even better margins, but we'll ignore that for a sec.
So let's say I'm not the target audience, as a single millenial who only goes to Costco on average to buy about five things. If Costco gets the same membership dues from me despite my using less of the store than full families, isn't that good for Costco?
That seems like an optimization for folks with cars…
I don’t think this situation is entirely representative of most other millennials in North America. As a cohort though, we’re likely to be less well-off than boomers, so I think Costco has economic appeal still.
[1] The canteen area had decent North American-style pizza so I could be tempted to make the trip.
Do you think Costco will rise in popularity any further? It looks like it's at a maximum of ethicalness to profitability in terms of food goods. (It offers bottom barrel ethics on clothes as far as I've seen) Do you think if the economy tanks then costco will just immediately switch to less ethical options because consumers will not be able to afford all their more ethical options? Did anyone study what they did during the recession?
I feel like a lot of their more ethical food options are more recent in invention... Mainly following upper class trends. A lot of the things there seem like they're trying their best to imitate what the upper class has. It's rare to see a high end good by itself at a good price. They offer thermoflasks instead of hydroflasks. Only one or two Le Creuset pots but they're really high priced still. Kirkland versions of kitchenware instead of the cuisinart ones that are just knockoffs of the all-clads everyone wants.
Personally - Costco feels like a slight improvement over Walmart but only at certain goods. It feels far lower than Whole Foods when it comes to ethical choices. I think that ethical gap is far greater than the image you posted gives off.
As far as price goes - I think Costco only feels like a good value to consumers who aren't savvy at shopping. For me - an overly savvy shopper - I feel like I'm getting ripped off when I go there as I buy most goods for less or equal to what they offer.
Also, shoppers beware. I don't know Costco, but here in Germany there is also a company that is famous for its good prices, Aldi.
Legend has it that they deliberately used wooden shelves in their stores because they looked cheaper, even though actually metal shelves would have been cheaper. Was reminded of that story when I read in the article that at Costco you shop off shipping pallets.
Also Aldi is being criticized for using its market power to demand low prices from suppliers. How does Costco fare in that regard? (I personally don't share the criticism, but I suspect people who are in the business of worrying about "fairness" would).
The biggest one is that the parking lots at the nearby ones are CRAZY. Always packed, and even worse on weekends. They are so bad, in fact, that I even avoid the streets NEAR the Costco, because they back up. And I live in Los Angeles, where I expect bad parking and traffic... this is another level.
Also, I am just getting so used to ordering everything online. We get all our household items via amazon subscriptions (toilet paper, paper towels, dish detergent, etc)... so nice not having to ever think about those things and they just show up when we need them. I can't see myself going back to shopping at stores myself for those things.
Right now my Costco has gas 50c less than any place around me
So Costco is paying less, and keeping less (if any) profit. The net result is that their gas is appreciably cheaper.
And in our case, we already have electric cars anyway.
The design of the stores is also horrific, designed to make you maximize browsing time. Availability of products is piss poor too - one week you might find something you love, the next week you can't get it at all. I cancelled my membership after the first year because the main product I bought it for was no longer readily available.
Don't waste your money. Check your local flyers and cancel the expensive yearly memebership, it's just another way for big businesses to scam you.
While I hate that you basically have to make an on-the-spot decision, they absolutely crush it on quality and price 9 times out of 10.
https://www.amazon.com/High-Sierra-Visalia-Hydration-Backpac...
http://www.costcoweekender.com/2016/03/high-sierra-visalia-9...
For example, coffee. The vast majority of what I saw on the shelf was ground coffee – for personal use bulk whole beans are a better value because they stay fresher longer. Most of it was also Seattle's Best / Starbucks / Peets, not terrible but particularly good either. Kitchen equipment – Costco has great prices on Le Creuset, but only has two sizes listed online (both oval). Laundry detergent, mostly heavily scented stuff, pass.
IMO discoverability is on par with Amazon (not a good thing) which discouraged me from spending more time than necessary in the warehouse.
I was looking on the shelves that were stocked with (ground) coffee. If there is a separate aisle for whole bean coffee I didn't bother looking for it -- I dislike the unlabeled aisles and don't want to wander through a huge warehouse looking for a needle in a haystack.
Granted I only skimmed the brands I knew I wasn't interested in (e.g. Starbucks) so there may have been some whole bean coffee on the shelves that I wouldn't have bought in the first place. I definitely haven't seen customer use coffee grinders though. It could also come down to differences in what the warehouses stock, but I'm not going to drive all over the Bay Area to find a Costco with whole bean coffee.
I just though of something else about the dutch ovens. Costo.com also lists a Lodge enameled dutch oven for $58. It's the shape (round) I was looking for and about the right size. I passed because I was looking for a made in not-PRC one. Amazon carries the same Lodge one for only wants $60 though. I ended up with the Williams-Sonoma house brand one (made in France by Staub) for less than Costco wanted for their similarly sized Le Creuset one.
I've heard good things about the print lab, pharmacy, and optometrists but have never used them. The Costco prices on vaccines compare favorably to the normal prices of the city/county run SF clinic, but not by a whole lot. The state of California subsidizes some vaccines for low income folks though. At $26 those are cheaper than what Costco charges (except for the flu vaccine).
https://www.sfcdcp.org/aitc/aitc-regular-prices-low-cost-or-...
https://www.costco.com/Pharmacy/adult-immunization-program.h...
The price/value proposition just wasn't there for me.
And that’s not really how Costco works. I don’t buy coffee there either, to be fair.
Yep. However I went in looking for coffee that Costco does stock (Peet's Holiday Blend) and only saw it pre-ground. I looked around for other roasts that grocery stores sell as whole bean in 2 lb packages (e.g. french, espresso, or italian) and only saw pre-ground on the shelf. The prices were on par with what Safeway charges off-sale.
Even for other items where I largely don't care about a specific brand the quality or price wasn't worth maintaining a membership.
The large packs are also $1-2 cheaper and you can split and freeze them yourself if you’re not a total carnivore.
I'm not sure that's accurate. Some of them definitely are but I believe the filet's (for instance) are not. I guess I'll have to double check next time I'm there.
Eh, all those recommendations are very conservative. I've been eating undercooked ground beef my entire life (it tastes better.) If it's ever made me sick, it wasn't sick enough to notice.
https://www.amazingfoodmadeeasy.com/info/modernist-cooking-b...
If I'm wrong, please correct me!
The other option of course would be that it's just HN-style 'nerding out' on any topic, (which is great) but I see it on Reddit and cooking blogs/recipe sites too.
e.g. Costco sells prime-grade brisket for ~$4/lb. where I live. You generally can't even find prime brisket at an average grocery store, and the choice-grade will routinely run $7/lb or more.
Have you never been to an IKEA? If you want to see what maximizing browsing time looks like IRL, you should visit one some time.
Ikea actually minimizes it if you know what you're looking for. Try doing that at Costco where they re-arrange the store just to make you have to look at things you didn't intend on buying. This practice has been the subject of many articles even:
https://www.businessinsider.com/costco-store-layout-how-to-g...
https://www.npr.org/sections/money/2015/09/25/443519599/epis...
If Costco has the piece of furniture, its either in the middle display area or on the furniture aisle. That's it.
1) Are you comparing equivalent quality meats? It's easy to find crap quality meat near its expiration date for cheaper than Costco deli price. It's pretty hard to find equivalent high quality fresh meat at the same price point without a bunch of coupons or random sales.
2) I'm not sure why you think the store design is horrific. Maybe it's particular to your local Costco, but I've been to at least 15 locations and they're all laid out pretty neutrally with logical aisles and departments. If you know what you want, you can go straight to it as quickly as you can navigate oblivious people pushing their carts at grandma-with-a-walker pace.
3) You're right - items do go in and out of stock because of the whole Costco business model. They arrange for preferential pricing on a contractual basis to get members deals they won't find elsewhere. Sometimes the supplier decides not to renew the contract or Costco decides the shelf space is better used for something else. That's just how it works. If you find a product you like, you can always order it in bulk online when Costco doesn't have it anymore. If you're only going to Costco for one or two items you like, the membership isn't for you.