How Much Will You Save on Groceries by Joining Costco?
Last updated September 2018
For some food shopping, Costco offers a low-cost alternative to supermarkets. It 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, Costco—which specialize in bulk sales—we found it stocked 44 percent of our market basket items.
The figure below indicates how much Costco could save you. Since it 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 Costco’s prices for amounts specified in the market basket. After this adjustment, we compared the prices of items at Costco 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 Costco was usually larger than the sizes of the items priced at the other stores—so Costco enjoys an advantage in such a comparison.
We found prices at Costco offers significant savings for most shoppers. For example, prices at Costco beat those at QFC by a whopping 33 percent, beat Albertsons’ prices by 32 percent, beat Target’s by 24 percent, and beat Fred Meyer’s by 19 percent. But shopping at Costco won’t net you savings compared to what you’d pay at WinCo, and saved us only four percent off Walmart’s prices.
In addition to having low prices, Costco received very high customer ratings for the quality of its meat and above-average scores for produce quality and overall quality.
Costco’s savings perhaps aren’t enough to justify paying its annual membership fee if you don’t use it often. And if half of what you buy is wasted due to spoilage, you won’t save by buying in bulk.