IN OTHER WORDS | Why I Love Costco

When I was in business school at the University of Washington, Seattle, Jim Senegal, the founder of Costco, spoke to my Entrepreneurship class. It was 1992 and Costco was a baby. Senegal was a true entrepreneur with a unique business model. The class was rapt.

First, he was accessible. There was no affect or arrogance, just determination in his compact bulk. He was clearly a man who had worked hard. He had passion for his company and his people. He talked about teams, about creating great work environments, paying well, and insuring well. His business goals included effective business models, eliminating inefficiencies, and not needing to be all things to all people.

He told us his salary. It was low for an executive. In fact, Costco executive salaries have remained low relative to other Fortune 500 companies while employee salaries are higher.

That weekend in 1992, I bought a Costco membership, on my meager graduate school income. Today, over two decades later, I am still a member. I now have an Executive Membership and get a percentage back for every dollar I spend. I earn back between $80-100 per year, in addition to my regular savings.

I have learned over the years to be a savvy Costco shopper. When I was single, I only bought non-perishables, freezable items and canned goods. Now, I do most of my shopping at Costco. Yes, there are items Costco doesn’t carry. One of their strategies is limited options; it keeps costs down. But, do you really need sixty choices of toothpaste? When each tube costs $1-2 less at Costco, I say, switch brands.

This year, I saved $80 on prescription glasses for my son. Insurance would only cover a certain portion. At Costco, he found nice frames for a great price. Not only that, when a piece of the frame fell off, they replaced them on warranty, no questions asked.

As a member, you do pay a fee, but this encourages loyalty. Costco also has a generous and member-friendly returns policy. I always keep my receipt, that’s just me, but if you shopped with your Costco card, you can return almost anything, anytime, save electronics.

Yes, you have to buy in bulk. But if you shop smart, and have storage space, you save. Costco marks up items no more than 15% while supermarkets mark up to 25% and department stores up to 50%. With items like Kirkland brand (Costco’s own) toilet paper, eco-friendly laundry detergent, trash bags and other household items, you save hundreds. Fruits and vegetables last longer. Meats and breads can be frozen. Things like shampoo, pain relievers, toothpaste, razors, all very expensive in small quantities at drug stores and supermarkets, mean huge savings when bought in bulk.

And, let’s talk samples. Samples are what make going to Costco a true event. You can try everything from jalapeno sausage to cinnamon French toast to lobster bisque. And during the holidays, it’s a bonanza! Cookies and candy and more! My advice: wear elastic waistband pants.

Since I work from home, I usually go during the week, although sometimes, I end up there on a Saturday, with the crowds, and wonder if I’ll ever be the same again. Now that I live in Austin, famous musicians wander the aisles. I once saw Jimmy Smith from The Gourds. He was tooling around Costco with cart of bulk granola and organic coffee beans.

pizza costcoWhen I lived in Seattle, I shopped at the flagship store. Every so often, Jim Senegal would come in for a hot dog and a Coke. He’d sit at one of the benches and strike up a conversation with a member. He’s just a regular guy. And that’s what I really love about Costco. It’s just a regular guy place. Yes, they sell fancy champagne, but you have to box it yourself, and they may or may not have your brand. But where else can you get a slice of pizza the size of your head, and a palette of Ex-Lax on the same shopping trip?

You’ll see a new post from me, every day in November as part of National Blog Posting Month, NaBloPoMo. Join in for an entire month dedicated to writing. See BlogHer for all the information you need to get started.

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