Monday, April 10, 2017

Review of Wholesale Clubs

Wholesale clubs can be a trap for the unwary, or the source of great discounts for buying in bulk.  Whether they are a money-waster or money-saver is up to you.

We just returned from Sam's Club - the WalMart version of Costco.   The interesting thing was, we ended up going to WalMart Neighborhood Market (Ghetto Gourmet) on the way home, as the "Sam's Club" didn't seem to have what we wanted, and the prices seemed to be "meh".

We got there after 9:00 and the greeter told us that only "business" members could come in between 7 and 10.  He let us in, but told us we could not check out until 10.  That sort of left a bad taste in my mouth.   They are continually trying (like all the other clubs) to get you to "upgrade" your membership.  In fact, twice now, I have inserted my card in the machine to pay and been asked if I wanted to "upgrade" membership.   You have to be very careful there and not put your credit card in too early or it thinks you want to spend over $50 on a membership upgrade.   The first time, I hit "YES" thinking I was making my purchase, only to find out it was trying to upgrade my membership.  It took about 10 minutes and a manager to back out that transaction.

And yes, BJ's tries to sell you upgraded "cash back" memberships, but they do this in-person at the register, not automatically when you insert your credit card into a swipe machine!

A lot of bad first impressions from Sam's Club!   They are trying to screw you is the general thing I take away from the place.

The front of the store and all the end caps are full of impulse purchase items.   Fred Flintstone chairs, of course, outdoor screen tents and fancy-looking patio furniture.  Even a bouncy castle of your own, so you can launch your kids into space!   For a store catering to "business" they sell a lot of consumer crapola.   And far from being a "warehouse" it is a series of impulse-purchase displays.

A screen house and accompanying patio furniture set could run you over $2000 on your credit card and I guarantee you will look like utter crap in two years and be at your curb in three or four, tops.  If you want to "save money" at a wholesale club just avoid these impulse purchase displays.

The idea behind the wholesale club - or at least the idea they pitched to us originally - was that you could buy in bulk and save money by paying lower unit costs.  The quantity portions in Sam's Club are, however, huge.   And conveniently, next to the meat display is a freezer for sale for $179.99   I am not sure you are "saving" money buying a half of a cow and freezing it, when you factor in the cost of the freezer and the cost of electricity.

Overall, the prices were so-so.   A lot of things seemed to be the same price as at WalMart (the parent company) and the selection was kind of crappy, compared to say, BJ's.   Their wine selection was kind of thin, although like Costco, they had a "upscale" wine section, prominently featuring a lot of $20 to $60 bottles of wine.  Not exactly a discount bargain.

There was no deli, but they had a lot of packaged deli meats, that were moderately priced.   Maybe the place will grow on me, but I am skeptical.  We had gone there to get supplies for a pottery party, and they didn't even have frozen hors d'ouvres.   BJ's has an entire wall of them.   Maybe, for our market, they felt the demand was low.  They did seem to be selling a lot of sweet wines.  Moscato is not a wine!

Costco is everyone's favorite, but I am not so sure.   I have written about it before.  Yea, sure, they pay their employees more and have a high retention rate.  But quite frankly, I don't shop at a store based on their employee pay, and neither should you.   The contract between employee and employer is none of my business, and my personal purchases are not going to "change the world" nor should they.

And maybe this largess to employees is why Costco has the highest prices of any wholesale club, from what I can see.   Sam's Club seems to want to try to be a low-rent version of Costco, and fails miserably.  Costco has a great wine selection - of expensive wines.   Like Sam's Club (or vice-versa) they have a "high end" wine display of expensive wines and then the low-rent stuff on regular shelves.  Back when I was a young hot-shot attorney, we would buy some of these expensive wines, and didn't care about the cost.   We cared later on when the credit card bills came due.

We joined Costco and went twice in Florida.  It was also "meh" in terms of selection and pricing.   Like all "wholesale clubs" they also had their share of impulse-purchase big-ticket items.  I am guessing this is where these companies make their money.

But in terms of price and selection, it was a letdown, and we never renewed our membership.

BJ's Wholesale seems to have the best balance of low prices and good selection.  They may not have as much high-end merchandise as Costco, but they have a better selection of more "consumer grade" merchandise at far better prices.   And some locations have a deli as well, with prices far below grocery stores.  The wines are about 10-20% below the cost of both Costco and Sam's Club.

They have a pretty good selection of gourmet cheeses, and if you are having a party, check out their frozen hors d'ouvres.  It just seems like they have more stuff at far better prices than either of the other two "wholesale" clubs.

Of course, they play the game of the end-cap impulse-purchases, but it seems their impulse items are even priced more competitively that the other two stores.   Again, if you really want to save money, just walk right past these end-cap displays.

The only problem for me, is, it is over an hour away, which either means I really have to stock up, or waste a half a day shopping there.   Maybe they will open one closer to me soon!

So there you have it.  If I had to rate these warehouse stores, I would put them in order of (1) BJ's Wholesale, (2) Costco, and (3) Sam's Club.   It seems odd to me, but I think there are often better deals at WalMart that at its own wholesale club!