Does It Pay to Be a Warehouse Club Member?
Last updated in November 2015
For some of your food shopping, membership warehouse clubs offer low-cost alternatives 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 61 percent, Sam’s Club 54 percent, and Costco 37 percent.
The figure below 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. Bear in mind that this is not an “apples-to-apples” comparison; the sizes of the items priced at the warehouse stores were almost always larger than the sizes of the items priced at the other stores, so the warehouse stores enjoy an advantage in such a comparison.
The three warehouse clubs all offer significant savings. Sam’s Club, for example, beat Acme’s prices by a whopping 34 percent. And compared to Acme, the savings were about 32 percent at Costco and 25 percent at BJ’s. On the other hand, while the warehouse clubs offered significant savings compared to even the lowest-priced stores, these savings perhaps aren’t enough to justify paying the clubs’ annual membership fees if you don’t use them often.
In addition to having low prices, Costco received fairly high ratings for quality.
How Much You Can Save at Warehouse Stores
The graphs below show how much less expensive prices at the warehouse stores were compared to the listed supermarkets. For these comparisons, we shopped all stores to calculate the least expensive way to buy each item in our market basket, per unit, regardless of item size.
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. The table below shows price comparison scores for shopping at two stores—purchasing available market-basket items at a warehouse, and then buying the remaining items at a supermarket. For instance, the price comparison score for buying all available market-basket products at Costco and then purchasing the remaining items at Giant is $82. Compare this to the price comparison score of $90 for buying all items at Giant (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|