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Comment by maxerickson | Hacker News Reader

For this situation, Costco is in the unfortunate position of knowing what was purchased under each membership.

Still, seems kind of hard to argue that retail sales are not an offer and direct acceptance of that offer.

If youve never experienced costco or been a member, this is difficult to understand but there is an undercurrent, nay, a prevailing sentiment of savings value and above all else things like rebate and cash back. Costco has established transparency for the consumer so pocketing the money is an egregious offense for most customers.

- credit cards offered by costco offer generous cashback

- most costco food items include discount pricing thats predictable and visible in the price itself. the decimal value of the price can even determine if the item is being phased out.

- even costco memberships are broken down into savings and the staff will gladly quantify your expenditures and potential cash back should you change or upgrade a membership. unused membership portions are even refunded.

- the refunds. no questions asked, for virtually anything, any time. this is where the costco member expects tariffs to be refunded as well.

I fully expect these to get refunded back to customers.

I occasionally get a gift card in the mail for a product I already purchased from Costco because they negotiated a better price for the batch after the fact.

It looks like this: https://content-images.thekrazycouponlady.com/nie44ndm9bqr/3...

> a prevailing sentiment of savings value and above all else things like rebate and cash back.

I did some consulting work there a long time ago building some software to manage inventory in one of their departments.

When we asked about their goals, like improve margins, they said "absolutely not, we will not increase beyond 14%". When we asked why, they said "the minute our customers think we are increasing margins, we will lose members, and membership is the goal."

What do you mean by “the decimal value of the price can even determine if the item is being phased out” ?

Costco uses a convention for their retail (doesn’t work for by-weight) products where e.g .97 typically means it’s a limited run or to be discontinued.

There are others as well, they have more precise meaning for their internal procurement processes but that’s the customer facing rule of thumb.

Even if that was the case, your infering that customers who paid these fees are not entitled to be refunded when their suing the u.s. government for reimbursement of those collected fees.

If the narrative that u.s. consumers paid inflated prices because of this then the money should go back to the consumers.

I guess Costco suing for a refund means they need to finance that campaign, and Costco consumers can do the same to them; maybe Costco should just drop their claim and let consumers try and recover from the US government...

‘You’re’

And

‘They’re’

If you’re going to make legal arguments, spelling matters.

Hacker News is a court of law now?

It’s also not hard to argue that people accepted it because they assumed the additional money went to the government.

If they had listed a line item for tariff fees then I could see the argument and would say that any refunds should go to customers. By not listing a tariff line item, Costco absorbed the additional costs and likely increased prices. In that scenario they, Costco, are the ones that should be entitled to a refund.

This is the same if you walk the chain backwards. Suppliers to Costco that simply raised prices and internally absorbed the tariffs are the ones due a refund, not Costco. Suppliers that sent Costco and invoice with a tariff line item should be on the hook to refund Costco (which means they should be seeking a refund from the US)

Amazon did try to add that line item and the administration pressured them to remove it. And you are making a very big assumption that either Costco or their suppliers absorbed the cost of the tariffs. Because I don't have a link handy, one study I read said more than 80% of the cost of tariffs came from the consumer's pocket, not the supply chain.

When I say absorbed I don't mean they didn't raise prices. I mean they didn't just transparently pass those extra tariff fees on to customers as a line item. With that increase in base costs they either lower their margins and earnings or they increase prices to keep them in a stable range. They are a for-profit business so it's highly unlikely they'd simply absorb the increased costs and not raise prices. There may have been some initial elasticity where costs rose faster than price rose.

It's not like Costco told them that. Buying something because a third party misinformed you (or in this case, was only temporarily right) doesn't invalidate the transaction.

You think a seller has some price obligation to you? If they set a price and you pay the price, what they paid for the good is irrelevant unless you had some cost-plus contract that they violated.

Costco's position seems pretty unremarkable to me. What % of modern retail sales are both paid in cash, and unconnected to any loyalty/reward program? I'd bet it's under 10%. And even then, a company could refund everyone it knew about, then say "bring in your receipts" for the remainder.

Costco requires a membership, and they do store credit back at higher tiers. They absolutely know what every member buys.

I suspect they're looking at the cost of implementing a one time refund/credit vs. reducing prices without the need to implement anything special.

Yes, I'm being charitable but not having to spend part of the refund on an extra program could benefit their customers more in the long run.

(We're Costco members.)

My point was that the other stores do, too. Or 90-ish %.

I remember a story on Walmart's data analysis capacity being something like 2 years of line item data for a customer. I've read numbers that suggest 10PB / day ingested from their ecommerce operations and 2-3 PB/hr data processing. Pretty incredible.

For modern ecommerce, figurative recording every twitch of your mouse in their store, I'd believe that.

But to save only the "SKU, qty., unit price, date" receipt info - which you would need to process tariff refunds - that'd be maybe 16 bytes per receipt line? To hit even 1TB/day, you'd need a billion customers, each buying 64 items. On that one day.

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