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Buying in Bulk: Shopping at Warehouse Stores
(Fall 2013/Winter 2014)
 
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For some of your food shopping, warehouse stores offer an alternative to supermarkets. We surveyed BJ’s, Costco, and Sam’s Club. These warehouse stores carried few if any of the items in our market basket in the usual sizes, but when we looked for the same brands regardless of size, warehouse stores, which specialize in bulk sales, stocked a larger portion of our market basket items. BJ’s had 48 percent, Sam’s Club 42 percent, and Costco 37 percent.

Table 1 indicates how much warehouse stores could save you. Since the warehouse stores stocked so few items in the sizes of our basic market basket, we looked for items of any size, so long as they were the same brands. We then used unit prices (for example, price per pound) to calculate the warehouse store’s prices for amounts specified in the market basket. After this adjustment, we compared the prices of items at the warehouse stores with prices for the same brands at several other stores.

 

How Much Warehouse Store Prices Might Save You Compared to Supermarket Prices*
StoreFor all products found at both stores For all products found at both stores where warehouse store package was no more than twice as large as supermarket package
BJ’s Costco Sam’s Club BJ’s Costco Sam’s Club
Acme 24% (47) 26% (31) 33% (38) 6% (19) 9% (7) 26% (13)
Giant Food 20% (45) 29% (29) 27% (36) 10% (19) 21% (8) 14% (13)
Pathmark 24% (46) 27% (31) 34% (37) 15% (18) 24% (5) 26% (13)
Redner's 13% (46) 19% (31) 22% (38) -2% (20) 9% (8) 9% (15)
ShopRite 14% (46) 22% (31) 23% (37) 3% (24) 15% (9) 13% (19)
Super Fresh 30% (46) 29% (29) 35% (37) 20% (22) 16% (8) 28% (15)
Wal-Mart Supercenter 8% (45) 17% (31) 18% (37) -4% (23) 7% (12) 6% (16)
Wegmans 17% (42) 19% (28) 25% (37) 0% (15) -9% (7) 12% (12)
* To determine how much more or less expensive warehouse clubs were compared to supermarkets, on average, we compared unit prices of dairy and national brand nonperishable products found at both the warehouse club and the supermarket. The number of products found at both stores is shown in parentheses. The specific supermarket store surveyed for each chain is the one for which we have a “variety” score for national brands, any size on our price comparisons table.

 

The left half of Table 1 compares the unit prices of all market-basket items available (in any size) at both the warehouse store and the supermarket; the number of items appears in parentheses. For example, 38 of our market-basket items were available at both Acme and Sam’s Club. On average, the unit prices for these items were 33 percent lower at Sam’s Club than at Acme. Bear in mind that this is not an “apples-to-apples” comparison; because the sizes of the items priced at the warehouse stores were almost always larger than the sizes at the other stores, warehouse stores enjoy an advantage in such a comparison.

Since the products at warehouse stores were often much larger than the items at supermarkets, the right half of Table 1 compares prices of items at both stores where the warehouse store package was no more than twice the size of the supermarket package. For instance, of the 38 products found at both Acme and Sam’s Club, 13 items at Acme were at least half the size of items at Sam’s Club. For these 13 items, Sam’s Club’s unit prices averaged 26 percent below Acme’s.

Table 1 shows that warehouse stores lose some of their advantage when up against more nearly comparable-sized supermarket items. The percentage savings at warehouse stores consistently decreases on the right half of the table compared to the left half—meaning supermarket prices compete more closely with warehouse store prices on comparably sized items.

Since warehouse stores focus on selling items in large quantities but do not carry a wide range of products, you will probably need to supplement warehouse shopping with trips to the supermarket. Table 2 shows price comparison scores for shopping at two stores—purchasing available market-basket items at a particular warehouse, and then buying the remaining items at a particular supermarket. For instance, the price comparison score for buying all available products at Costco and then purchasing the remaining items at Acme is $84. Compare this to the price comparison score of $96 for buying all items at Acme (purchasing national brands of the cheapest size).

 

What If You Shop at Two Places—at a Supermarket and at a Warehouse Store
(For complete market basket with national brands, allowing any size)
  Price comparison score if you shop only at supermarket Price comparison score if you buy available items at BJ's and other items at supermarket Price comparison score if you buy available items at Costco and other items at supermarket Price comparison score if you buy available items at Sam's Club and other items at supermarket
Acme $96 $81 $84 $80
Giant $86 $77 $77 $75
Pathmark $96 $80 $84 $80
Redner's $84 $74 $76 $72
ShopRite $84 $77 $77 $75
Walmart Supercenter $76 $70 $71 $69
Wegmans $80 $75 $74 $72

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