The national survey of 2,932 Canadians, conducted by Maru Public Opinion as part of the Canada’s Most Respected Awards Program, found that Costco was the most respected food retailer in Canada for the second consecutive time.
Costco’s business model makes way more sense than most other grocery retailers. My only complaint previously was that the sheer volume of groceries you needed to buy to make it worthwhile turned it into more of a mecca of car-dependency culture than anything.
Now that there are somewhat affordable delivery options, they are head and shoulders better than any other grocery store in my opinion.
Costco’s business model makes way more sense
Yes, there is something to be said about only opening stores in high density, high income neighbourhoods. With only 855 stores worldwide (and only 107 in Canada), they are able to generate well over a billion dollars in net income by doing so.
But there is only so many high density, high income neighbourhoods, and they can only handle so many stores. It is not really a duplicatable model. Instead, Loblaw and the like go where Costco refuses to. You can actually find their stores in small towns and other poduck places.
Sure, it’s not nearly as profitable serving the poor. Loblaw has over 2,400 stores, yet only sees a measly 500 million dollars in net income, but ultimately someone needs to service those markets. And, really, it’s still a pretty good gig. Old Galen there isn’t exactly hurting.
Short sighted MBAs that try to squeeze out every penny from consumers don’t realize (or don’t care) how valuable good will is.
It’s not even good will. Retaining skilled employees is worth more to the company than suppressing wages.
I worked for a Sobeys chain for over a decade and lost count of the number of times they let a skilled employee walk over a trivial promotion, only to have to fill their position with two people in the short term. Then after countless hours wasted searching for and training a replacement they’d do the exact same thing.
Like, you can’t bump your weekend dairy guy from $17.50 to $18 but you can replace him with 2 high school kids making $15.25/hour that combined still manage to do a worse job.
I was pleasantly surprised to discover our local Costco has a bike rack! It could be oriented more towards employees than customers given its location closer to the employee entrance, but I’ve always thought of it as a car-oriented place given their bulk sales focus. I have been there by bike to pick up small items like pharmaceuticals, batteries, etc. and it’s nice to not have to fight for a parking spot on a busy Saturday.
What’s telling is that some of Loblaws brands actually went up in the survey. When you own so much of the grocery business and have a captive customer base you can do pretty much whatever. Do we have any antitrust legislation in this country?
We have some of the most concentrated markets in the world in certain sectors, notably the telecom cartel. Due to car culture and the advent of the supermarket, we don’t have small neighborhood grocers anymore. We do here in Vancouver, small immigrant run shops, and let me tell you, the quality is high and the prices are WAY lower than the national chains.
I’ve only ever heard positive things about costco as an employer. good on em
It’s not all roses but the shit that sucks, sucks everywhere so what can you do. The money is at least worthy of human life
Their financials are quite interesting. They make basically most of their money on memberships. Or, to put it another way, the price of items in the store is roughly equal to the cost of goods plus their distribution and overhead.
Or, to put it another way, the price of items in the store is roughly equal to the cost of goods plus their distribution and overhead.
I find that really hard to believe, since I find it’s very difficult to get a good deal on anything at Costco. I’m sure there are some good buys, but that’s true for every store.
Costco either don’t have much buying power, or other companies are selling at a loss (which we know isn’t true, since other companies are posting record profits all the time).