Why are prices in stores like Costco and Sam’s Club much cheaper than your average grocery store?

Question

Why are prices in stores like Costco and Sam’s Club much cheaper than your average grocery store?

In: 226

Answer 1

They are whole sale stores.

Essentially the way stores work is you pay more every step of the way

So manufacturer charges much less than everywhere.

Then whole salers buy in bulk and pay more.

They then sell lesser amounts to normal stores who then sell it to you.

Each step of this chain the cost is passed on to you.

If manufacturer charges $1 a box. The whole saler probably charges $1.50 a box.

So the normal retail store charges $2.50 a box

Costco and Sam’s club bypass the retail store aspect.