Costco vs. Sams club: what is the advantage of whole sellers?

Is buying in bulk really more cost efficient? Yes and no. Whole sellers like Costco and Sam’s club sell their products in bulks to their customers.  Both Costco and Sam’s club give out the idea to the public that if they buy in bulk, they are saving money. This is not necessarily true. It depends on what you are buying.

For example, Produce is a “do not buy”  in bulks for obvious reasons of course.  How long would it last you? It would go bad and end up in the trash if you don’t use it up quick.  But frozen foods and meats are products that you should buy in bulks.  It is more cost efficient to buy them in large quantities and it will last you long.  The disadvantages of buying in bulk and being apart of the wholesale clubs is the annual membership fees. It also easy to get carried away and go over your budget when you are buying in bulk. Expired shelf life can also be a disadvantage. But despite the disadvantages, whole sellers manage to attract people to them. This is because of the savings in buying in large quantities and having to make less shopping trips, which overall saves you time and transportation costs. The savings are the main reason as to why Costco and Sam’s club are so successful.

Now whether Sam’s club is a better whole seller or Costco is the question. Each of them have different management techniques.

One of the critical decisions in Operations management is the location. Sam’s club is located in areas where people have to budget shop while Costco tends to be located in the wealthier suburbs. In terms of managing quality is concerned, Costco provides better quality   and less selection in their management techniques while Sam’s club offers more selection in their products but with lower quality.  Hence, why Sam’s club is a better place for most everyday necessities such as toilet paper and water bottles in which brand name does not matter. But, Costco is better for those looking for better brand names such as in clothing.  It is also proven that Sam’s club membership fee is cheaper than Costco’s. Costco pays their employees more and that actually effects the environment in the store. If the employees are getting paid well, they will have a better work environment with less stress; therefore providing better customer service.

Overall, I prefer Costco over Sam’s club. This is because of the excellent customer service they provide. Management is excellent at choosing their employees and providing a good environment. The greeting workers that provide samples of products during the shopping experience is a plus point for Costco. Although the membership may be a little more pricey then Sam’s club, the products at Costco are much better in quality which is more important to me.

Would you prefer to have a membership at Costco or Sams club and why? Overall, is it better to buy in bulks?


12 thoughts on “Costco vs. Sams club: what is the advantage of whole sellers?

  1. I prefer membership at Sams Club than Costco and I think that it is better to buy in bulk as you save money by buying in a bulk, reduced shopping trips resulting in saved time and money on gas. However, as you mentioned customer should by only certain type of goods in bulk such as frozen food and meat, soft drinks and other beverages. I believe that these whole sellers are not only attracting regular households, but also small businesses specially C-stores, because of their low price.
    As in charge of inventory purchases at gas station, I have shopped at both Costco and Sams Club. And I used to prefer Costco for its quality and control. But lately, many of my friends and I have experienced poor control in management. Costco put tax sticker on the cigarette carton in the back of the warehouse. And my last three orders of more than 50 cartons of cigarette had few cartons with improper state tax sticker or no sticker at all. This careless mistake could have cost my store thousand dollars in fine, if I had not noticed that. In contrast, I never had any kind of problem at Sams club. I think the reason could be not proper control over that part of the area where stickers are applied or increasing orders. But in any case, from that day I try to avoid Costco and started going to Sams Club more often.

  2. I have to agree in that buying in bulk being cost efficient is both a yes and no, and to me that is because it depends on who is buying it and what you are buying. Daily needs such as paper towels, tissue, or toilet paper are god items to buy in bulk because you are going to need to use them anyway, and there is no expiration dates on these products. However, when we talk about purchasing food in bulk, it really depends on who is buying it. If you have a large family, buying food in bulk is probably cost efficient, assuming that your family can consume all of the food that you bought before the food expires. However, if you have a small family (like me), buying food in bulk is not much of a good idea, because all of the food would not be consumed before it expires. So really, wholesale shops such as Costco and Sam’s Club are good ideas for being cost efficient, but it really depends on who is doing the purchasing, and what you are purchasing.

    I personally prefer Costco over Sam’s Club purely because of the accessibility of the stores. There are 3 Costco stores that I can get to easily, whereas there is only one Sam’s Club in Chicago.

  3. I would definately consider buying in bulk and consider becoming a member of Sam’s Club or Costco. When you walk into Sam’s Club or Costco, you can get all of the shopping done at one store, instead of having to go to five stores to find what you want. Plus, the items in bulk are probably cheaper than buying the items that you want separately at separate stores. For example, you can get either ten items at $10.00 at a wholesaler, or get five items at $2.50 each at another store. That’s a savings of 2.50, and at Sam’s Club, or Costco, you’re not carting around five items, but actually ten items in one container. Also, as a bonus, you get the five more items for “free”, so to speak. Because of this belief, buying in bulk is not a bad idea to look at and after a while, it will pay off.

  4. I agree with this post and the three comments above. My parents have membership to both Costco and Sam’s Club so I visit both. Your writing made me think that there are more factors to consider when deciding which warehouse club best suits one’s needs. First, Costco’s membership is the most expensive with $55 a year while Sam’s Club is only $40 a year. But according to Consumer Reports, shoppers can save up to 55 percent at warehouse clubs. Second, nonmember surcharges is an important factor. Buying in bulk saves a lot of money as supposed to shopping at supermarkets, but consumers do not go to warehouse clubs often.Costco charges the least in nonmember surcharges. Lastly, Sam’s Club has 620 locations in the U.S., while Costco has 450 locations; therefore, where you live matters.All in all, it comes down to individual preference. If you’re looking for low membership cost, a generous return policy, and 24/7 customer service, Sam’s Club is the way to go. If you’re into the best deals and want top-ranked customer service, try Costco. I found myself wondering which warehouse club I would choose to best fit my needs and it would be Costco. Very interesting post!

  5. My parents are all for buying in bulk because there are seven people in my family to feed. That alone is one advantage of purchasing from whole sellers. This is an important point because it makes buying groceries much cheaper.
    I was surprised when you stated that Costco has less of a selection of goods than Sam’s club. My own experience has confirmed otherwise. Costco has a great variety of food and products from all over the world; however, one difference I do notice is that it tends to be healthier. I wonder if this is why Costco has become increasingly more popular and done better in the market.
    In addition to this, Costco has excelled tremendously thanks to a great marketing strategy. I agree with you when you specify that they perform better in the customer service department than Sam’s club. I am curios to see how Sam’s will up the ante to compete with its leading competitor. I was interested to read that the membership at Sam’s is less expensive. What is the impact of that on consumers? You stated that Costco is pricier, but like Sam’s Member’s Mark brand, Kirkland is Costco’s generic brand that does appeal to those lesser income families.

  6. I would also have to agree that buying in bulk from wholesale corporations such as Sam’s Club and Costco is the way to go. These warehouse club’s offer memberships that provide people, especially families, with the opportunity to buy everyday needed items in bulk to cut down on costs and save valuable time by limiting their trips to the grocery store. In today’s economy, people must look for every opportunity to limit costs to stay within their budget. I for one always try to shop at Costco when I am home in the suburbs to stock up on things that I need such as groceries and paper towel. As for worrying about food spoiling because of an expiration date, I make sure to monitor what I buy, along with taking advantage of actually having food in my apartment by splurging when it comes to my daily meals. When it comes to choosing between Costco or Sam’s Club, I don’t necessarily have a preference. However, considering the information from this article, I would have to go with Sam’s Club due to the fact that the monthly membership is quite a bit cheaper, and I do not concern myself with brand names when it comes to food and paper towel.

  7. I would agree that buying in bulk is a great idea. My family used to go to Sam’s Club until a Costco opened up. We have been going to Costco ever since. I just think that it is a better environment, and you can tell that the employees get paid better because they have a better customer service. I also have a cousin that works at one and he says that they get paid well, and also get a good health insurance plan. I would pay a little more to go to Costco because I have never had a bad experience and only here positive things. But if I was tight on money and did not want to pay the extra fee, I would not be disappointed if I went with Sam’s Club. I know some people that choose Sam’s Club over Costco and that’s their opinion.

  8. I usually eat two to three apples a day so for me buying produce at one of these retailers is a good option for me. I would be careful to say that everyone shouldn’t by produce at bulk retailers. If you only have an apple once in awhile then I agree 100% probably should not buy Apples, or any produce, from these types of retailers. For me, I actually have a membership to both. Sam’s Club actually has a college membership, when I signed up I got my club fee back in the form of a gift card. Overall though, I prefer Costco for their friendly staff, great customer service, high quality (Kirkland is awesome,) and locations. There are two Costco’s close to me, where Sam’s Club is further than both.

  9. It can be a great advantage to buy in bulk but you must be smart with it. You must be an experienced shopper in buying in bulk. If you know how to do it you avoid the products with shorter shelf life and buy more of the longer lasting products. You’ll save a lot of money and time if you figure out the way to bargain buy with bulk shopping. A lot of Costco and Sam’s Club customers do not know how exactly to get the best deals and like you said might buy products that have a short shelf life in bulk and just end up waisting them. I am not that experienced with shopping at either of these stores but I can say I’ve been in them. I agree that customer service is a big plus so I would shop at Sam’s Club for that purpose. As for buying in bulk, if i know exactly how to do it I would but because I live in the city and am not around these stores a lot I just think it’s easier to just buy every 2 weeks or so and find where the bargains are and use my coupons. There are ways to save money you just have to be a knowledgable shopper.

  10. My family has been in the Gas station business for years and I myself have shopped for our gas stations from both Sam’s and Costco. I definitely agree with you that Costco has better customer service and quality, but with that being said, I still prefer Sam’s just because they are much cheaper.Buying from Sam’s saves us money even though Costco may provide us with better service. As a business, we try to save costs where ever we can and bulk buying is one of those ways for us to do so. If places like Sam’s and Costco didn’t exist, we would have to buy the products from suppliers and therefore, we wouldn’t make much out of that.

  11. I think it all depends on your life cycle stage. If you are a single guy like myself and have no need to buy in bulk, why would you? Companies like Sam’s club and Costco focus their business towards large families. As discussed above. It is very important to know what you are buying and knowing if you really have a saving in buying in bulk. I personally do not see the benefit of buying in bulk unless you have a very large family. I have never shopped at either located but even though Costco may have better customer service at the end of the day people just want to buy products and cheap as possible.

  12. I am currently a member of costco, but to tell you the truth from experiences. You most definitely end up losing more money. If you think about it, its something called “economies of scale”. Costco and Sam’s club purchases a lot therefore they can charge lower for the things you buy in bulk. what people don’t consider is that there are several cost that they aren’t putting into mind. for example think about the stuff you buy and how much of it you don’t use. Personally I would prefer neither, and buying in bulk is something that I don’t do because I like to spend what I use.

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