Is The Costco Membership Worth Paying For?

More than one person has comparison-shopped for an item that they regularly consume and has asked themselves, “Is the Costco membership worth the $55 per year the company charges?”

The answer is: it probably is worth it, but comparison shopping is still advised. Costco is not always the cheapest. For some products, Costco definitely offers the best prices.

We’re going to look a some popular products and compare prices on the Costco and Walmart websites. Then we’ll look at just how much an average consumer might save in a year.

Compare these differences with the costs for different types of Costco memberships: Gold Star, Business, and Executive, which are $55, $55, and $110, respectively, on an annual basis.

Keurig Green Mountain The Original Donut Shop Coffee

This is a popular product that many use on daily basis and is available from both Costco and Walmart. Comparisons are tricky because Costco sells 180-packs and Walmart sells 36-packs.

The $23.42 that Walmart sells the 36-pack for equates to a unit cost of $0.65. The $93.99 that Costco markets the 180-pack for equates to a unit cost of $0.52.

Let’s say an average couple, seeing as the Costco membership is valid for a member and a spouse, consumes one 36-pack per week. This means they consume 52 boxes per year or 1,872 individual Keurig K-cups. The difference in unit price is $0.13. So, over the course of a year the couple could would save $243.36, more than the price of each available Costco membership.

Letter-Sized Paper

Not surprisingly, Costco has branded its own line of paper, and offers pricing in three different tiers, Walmart really has just one competitive offering, and just barely.

Costco offers paper in 2,500-packs for $17.99 and 5,000-packs for $35.99. When buying 200 of the 5,000 packs at once, Costco reduces the price to $28.99 per package of 5,000 sheets. With this option the Costco unit price is $0.0058.

The $25.48 Walmart charges for the pack of 2,500 gives a unit price of $0.0109, or almost twice as much.

If a person or a business used 200 cases per year or 1 million total sheets, shopping at Costco would save them a whopping $5,100, which would pay for almost 100 Costco memberships.

Verbatim DVD-R

Who among us doesn’t use at least 100 of these each year? Some may use thousands. This is one product that Costco does not appear to offer the best price for.

The Walmart 100-pack is priced at $21.40. At Costco, the exact same product is priced at $36.99, or $15.59 more. A person who used 1,000 DVD-Rs per year would save $155.90; seemingly paying to be a Costco member and effectively boosting the price of the membership.

The Costco Membership Verdict

The Motley Fool has also noted the value the membership with Costco provides: for most, the membership is worth the price. Consumers must still research each product they buy, particularly if they consume large quantities, to make sure they are getting the best price. Unfortunately, consumers cannot simply purchase a Costco membership and assume they are getting the best deal, because, in some cases, Walmart offers the exact same products at lower prices.

There are ways non-members may shop with Costco. Some are discussed by Krazy Koupon Lady in the following video, along with other ways to save even more at Costco.

[Photo by Spencer Platt/Getty Images]

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