Is Costco a good company

What is costco and why do you have to pay to shop in hypermarkets? - Others - 2021

It is very likely that the name Costco unknown to many, while to others it sounds through some mentions in films or television series. But it'll be better for us get to know this retail chain and its special philosophy, as their settlement plan in Spain has just begun and they intend to expand not only in our country but throughout continental Europe.

What is Costco and why is it starting to get media attention? It is a real giant within international hypermarket chains and occupies the second position in the market worldwide. Originally from the USA, it is characterized by a special business activity based on a system of partners who pay a fee to be able to buy their products and promises very competitive prices in a very varied catalog.

Its origin and its philosophy

Costco Wholesale Corporation was born in the United States in 1976 under the name Price Club when it opened a business for professionals in an aircraft hangar in San Diego. This first business, started by the merchant Sol Price and his son Robert, pulled soon private customers who were interested in good prices and a wide variety of products, so the company's goals soon changed direction.

In 1983, he opened the first Costco warehouse in a Seattle warehouse with a former Price employee who specialized in large-scale sales and distribution. The growth was spectacular in the early years of operation and eventually Price Club and Costco became in 1993 united under a single company who was baptized as Price Costco.

The corporate philosophy has been the hallmark of Costco since its inception. The operation is based on an affiliate system that provides customers with access for a fee becomes his extensive catalog. The aim is to offer very competitive prices without losing product quality in order to get a good and loyal customer base, which seems to be working very well in the US.

The arrival of Costco in Spain and its expansion plans

After the company's recent overhaul and unstoppable growth over the past two decades, Costco established in different countries around the world including the Asian market and even Australia. Despite a notable UK presence with 26 locations, the landing in continental Europe was made to be begging.

Eventually they set out to conquer the old continent and rose with the opening of the first Costco in Seville last year out of our country. After some crucial first few months of researching the market and Spanish clientele, the managers assure that they have exceeded expectations and are ready to continue expanding into other regions.

On October 24th, the first store opened in the capital with the opening of the Getafe center. The Expansion plan intended for five years to be continued with further stores in Madrid, Barcelona and Valencia. In addition, they plan to make the leap to France soon and move on through other countries.

I want to become a customer, how does it work?

You could say that the Costco operating system is halfway between Makro and Lidl , two chains with their own personality that have established themselves in our market and also rely on competitive prices. Makro is the big professional sales giant, and the German chain has always offered very low prices with its special products and saved on other services. Costco has a bit of both business models.

In order to shop at its facilities, you must become a member and pay a fee. You can fill out the form in the same store or fill it out online. It costs around 36 euros per year for individuals and 30 euros for companies and the self-employed - It is given as 30 and 20 euros plus VAT. Once you have the card, you as a customer can access it and make regular purchases. If you are not satisfied even on the same day of discharge, they will return the amount upon withdrawal.

Costco is primarily attracting its range of basic products, especially groceries and staple foods. Much of the catalog consists of dry foods which makes sense considering how they keep their prices low and check products and prices every day. Another attraction is the “Bazaar” area, where almost everything comes in, similar to temporary offers from companies such as Lidl or Aldi. Here you will find everything from toys, clothing, household appliances and kitchen supplies to jewelry, decorations or electronic products.

How to get such competitive prices

The affiliate system and the opening of more and more centers make it possible to bet on this competitiveness in terms of price, but it is a sum of other factors as well. First Costco locations save the most on secondary facilities and services . The stores are more like industrial warehouses, where products are placed in large piles on pallets and tall shelves. There is no place for attractive setups, decorations or pleasant music.

Another characteristic of his philosophy is the large format, not only in the space of his premises. The vast majority of products will sold in extra large formats or family packs with many more units, than we are used to in a normal consumer market. The aim is to sell a lot of volume in order to adjust profits and thereby lower prices.

They claim to always offer the best brands, although we can also find some well-known blazers that have not yet won the trust of the Spanish public. you also have their own private label, Kirkland Signature , of whose quality they are particularly proud, as they guarantee maximum guarantees through careful support for suppliers.

At Costco, they don't just invest in marketing or promotional campaigns, they want to take care of the customer, to have a good number of regular loyal buyers, and they save the most on their premises. They keep checking prices to customize daily and prefer a small selection of brands in huge formats to increase sales.

Is it worth paying the affiliate fee and buying a lot? As always, it depends. Everyone has to analyze which products are more interesting and compare the quality and prices with other places in order to calculate and assess whether the investment is worthwhile. It must be clear that no center will offer us the best absolute prices in the entire market as there are always differences between some products and others. So it's time to compare and decide.

In principle, professionals and larger families can benefit more from this sales system, though Costco is still taking its first steps in our country and is still a little to local requirements needs to adapt . It seems that they are changing the format of some products that are too big to convince the Spanish buyer more and the most attractive brands are being evaluated. We'll see if the American giant finally succeeds in conquering the Spanish market.

Images - Jeepers Media, Dylan, Pixabay
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