Monday, August 08, 2005

Buying in bulk

I've seen a number of personal-finance articles that caution that depending on your specific shopping habits, warehouse clubs like Costco may not be a particularly good deal, especially when compared to careful shopping with both sales and coupons at your grocery store. I'm beginning to collect data to quantify this claim a little more finely. So far, it appears that there are some items (e.g. butter, coffee, milk, peanut butter) where Costco's prices are excellent even compared to the best sale-plus-coupon prices at the grocery store. For other products (e.g. most paper products, such as toilet paper, paper towels, and the like), Costco's price can be handily beaten by careful sale-plus-coupon grocery shopping. I haven't yet found anything at Costco that is more expensive than the regular grocery-store price. And of course, shopping at Costco is much less labor-intensive than careful sale-watching and coupon-clipping. On the other hand, you have to store these large quantities, and you should always keep in mind that if something costs half as much, but goes bad before you've eaten half of it, you're losing money. I'll post a more detailed report when my data collection is complete.


  • You also need to factor in membership fees and store locations. We just passed on renewing because there was no savings for the stuff we buy. BUT Costco is a fun store even if it is no longer THE place to save.

    Nice site!

    By Anonymous Anonymous, at 5:34 PM  

  • Fantastic blog.

    Yes, with the yearly membership fee it would be easy for the average person to lose money by shopping at Costco.

    I do Sam's Club and coupons/grocers. I'm not sure I'll renew.

    By Anonymous Todd, at 12:33 AM  

  • Nice blog, I plan to read it more. I have been meaning to make a blog about how I handle the kitchen (very small, increasingly equiped with good tools, make a lot from scratch, etc.) efficiently.

    As a matter of principle, I don't shop Costco because I will not pay a membership fee for the "priviledge" of spending more money there. That, and the one location in my city is in an industrial park too far from my home (gas counts, too, especially these days).

    Another matter for me is freshness and nutritional value of the food. Bulk packages are great for non-perishables - detergent, etc. - but for edibles, you have to consider how much cr*p they put in the food to give it shelflife, especially in large sizes that are likely to last longer. I see a corelation between the size of the product and how processed it is for shelflife's sake.

    When it comes to food, I just shop for small quantities, frequently, and look for the least amount of processing possible. That's probably my French background and I agree that it's not ideal for people who prefer to do their shopping once a week or every 2 weeks. But I like it like that and I place a lot of value on what I eat.

    By Anonymous Julie, at 8:53 AM  

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