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Costco 5 Star Rating: Cheapism Best Pick
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Cheapism's Costco review found much to praise. Consumers who regularly shop at Costco award gold stars to the employees and to the merchandise. "For me, it's about business practice and quality of products, and Costco excels at both," said one respondent to our online poll about this wholesale club and Sam's Club. She deemed the in-house Kirkland Signature line "exceptional" and said it affords her the "healthy choices" she demands for her family. Another reviewer wrote, "Hands down -- from employees, to produce, to organic meats and seafood -- Costco is light years ahead of Sam's."

Costco sells the usual assortment of discounted items, often in bulk quantities that seem destined for large families or small businesses, in categories ranging from groceries and automotive supplies to office supplies, clothing, electronics, jewelry, personal care products, and more. Pharmacies and Costco Optical centers are widespread. Some locations even sell funeral caskets and cremation urns. Many are graced with members-only gas stations that post aggressively competitive prices. Shoppers with a regional penchant are likely to find some locally sourced food items on the shelves.

Costco offers additional savings with even better in-store deals on a rotating variety of items, and posts consistent low prices on photo printing and medications. Members at any level who don't have prescription drug coverage qualify for savings in the pharmacy department, which range between 2 percent and 40 percent on medications. By contrast, discount drug prices at Sam's Club are offered only at the highest membership level.

In two particular realms, Costco outshines Sam's Club. The offerings in the organic/health food aisles at Costco are a boon to consumers who are conscientious about their diets and their wallets. We've spotted organic produce and pantry staples, including (in-season) strawberries and blueberries, salad greens, frozen vegetables, eggs and milk, olive oil, bread, canned tomato products, sugar and raw honey, ground beef, and wild-caught salmon. Organic offerings at Sam's Club, in comparison, are quite sparse.

The range of services available at Costco also bests those at Sam's Club. Costco offers free hearing services including hearing aid testing, cleaning, and battery replacement. Members can claim discounts on car purchases and service through select dealers and reduced rates on auto, home, life, and identity theft insurance through third-party vendors. Business services include payment processing; health, dental, and vision plans; phone services; and payroll services. Among the other offerings: check printing; water delivery; home mortgages and refinancing; and free rotation, balancing, and repair with tire purchases.

We conducted an in-store shopping cart test to compare prices with Sam's Club. Of the 30 products on our list (groceries, cleaning supplies, baby items), unit prices at Costco undercut Sam's Club on 14 (including pretzels, bread, ground beef, bananas, applesauce, and disinfectant wipes) for average savings of 11 percent; a discount on toothpaste brings the total to 15 items. In general, we saw more in-store savings at Costco, although we did not apply those limited-time discounts to our price comparison. Prices on photo printing (4x6 print) and flu shots were equal at both stores. A few electronics we compared were similarly priced, although a DSLR camera bundle cost much less at Sam's Club.

Costco offers a slightly more generous return policy, especially for small electronic devices, than its rival. Members can bring back merchandise without a receipt and there is no time limit on items other than electronics, which must be returned within 90 days. One strike against Costco: American Express is the only credit card accepted in stores, although payment with cash, debit card, or Costco's own credit card is welcome. Note that the company is leaving Amex to partner with Visa beginning April 1, 2016.

There are three membership levels at Costco. Gold Star (the basic level) costs $55 a year and comes with one primary card and an extra for another adult in the household. The $55-a-year business membership entitles the member to add up to six more cardholders (at the same $55 annual fee for each card) and to resell purchased merchandise. Executive memberships go for $110 a year and return 2 percent on purchases up to $750, offer steeper discounts on some services cited above, deliver more travel benefits, and include free roadside assistance for vehicles covered in the auto insurance program.

Overall, Costco holds a slight lead over Sam's Club as our preferred warehouse club. Considering the range of organic and health food options, everyday discounts and extra savings, generous discounts at the pharmacy for all members who lack insurance coverage, and extensive service offerings, Costco is well worth the price of membership.

by Raechel Conover (Google+ Profile) – March 27, 2015
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