Warehouse Clubs Worth It?

Hey Peeps!  Would you give a store money before you shop so that you can get a discount later? Many of us are already doing just that. Nearly sixty percent of Americans are members of shopping clubs according to a recent study.  To get deals on goods or free shipping, we pay a monthly or an annual fee to niche retailers and giants like Costco, BJ's, Sams Club and Amazon Prime.  Some financial planners claim there’s simply no excuse for not belonging to a warehouse club if you live within driving distance to one. But there’s one obvious snag. . . Before you can fill up your cart with these bargains, you have to pay an annual fee just to get in the door.

Before you sign up you should look at the big picture. . . if you are a family of two, then Costco, BJ's and Sams club may not be the best place to do your grocery shopping. But, if you run a carpool and the warehouse sells affordable gas for your gas guzzler than maybe you should join.  But, there is always the fine print. What are the limitationshow much is actual cost of the membership;  when does it expire;  does it automatically renew????  And, the big question - why join if the membership fee is greater than the sum of your discounts?

How will you know that? Your'e going to have to scout the warehouses before you join. It's hard to get in without joining the club unless you can get your hands on a one day pass. Another way to get a sneak peek into Costco is to get one of their gift cards.
Membership Fees
The standard annual fee for a household or a business is $45 a year at Sam’s Club, $50 a year at BJ’s, and $55 a year at Costco. In addition, all three of the major warehouse chains give you the option of paying more up front for your membership in exchange for rebates or discounts on the goods you buy. These top-tier memberships – Executive Membership at Costco, Sam’s Plus at Sam’s Club, and Perks Rewards at BJ’s – cost roughly twice as much as a regular membership and give you 2% back on nearly everything in the store. That means you have to spend between $2,500 & $2,750 per year before the higher-level membership will pay for itself.

Oversized Packages and Quantities
Warehouse stores are known for their jumbo-size packages. Buying in bulk to save money makes perfect sense with some products, such as mouthwash or soap. But it can be a problem with products that do not have a shelf life. Unless you’re sure you can eat five pounds of cheese before it goes bad, the extra food is just a waste of money.

Impulse Buys
These stores are huge and crammed with an incredible variety of goods. Even if all you want to buy is cereal, milk, and toothbrushes, you’ll probably have to walk past TV sets, clothes, and toys to get to those three staples. This makes it very easy to fall victim to temptation and walk out with a whole cart full of impulse buys that weren’t on your list.

Restrictions on Coupons
Neither Costco nor Sam’s Club accepts manufacturer’s coupons. BJ’s takes them, but only in paper form – the stores aren’t set up to take mobile coupons.

Deals That Aren’t So Great
With such a vast assortment of goods gathered together in one store, warehouse stores may seem ideal for one-stop shopping. However, while they offer great bargains on some items, others are disappointing.  Kiplinger says "warehouse stores aren’t your best choice for appliances, as their selection is limited and they don’t offer the frequent sales you’ll find at other stores". Also, ShopSmart notes that you can get better prices on Coca-Cola and Tide detergent by looking for a sale – or better yet, stacking a sale with a coupon – at your local supermarket.

Of course, the membership fee can pay for itself if the prices in the store are low enough – and if you buy enough for your annual savings to add up to $50 or more. But how can you tell whether the math works out in your favor? To answer that question, you need to seriously look at everything and determine if you will shop there a lot.

My Cousin Wint is a very loyal Costco member and has been for years. He even bought his automobile via a Costco member source. (And he lost out on additional dealer warranty) But, don't tell him that. He does not want to hear it! To do some research, I accompanied him on a trip to the warehouse. A large chunk of my time was spent in the book section. They had a large assortment for less than retail prices, but books are not a staple there, therefore it is a hit or miss. Then I meandered over to the personal items section and found my favorite toothpaste in a four pack for cheap. When it was all said and done. . he bought produce, food and a book and I got toothpaste. His store did not have fuel stations, so we did not shop the gas prices.

A warehouse store can be a great place for you. . . If you buy in bulk; shop certain brands that they carry or if they are located near your home. But, like everywhere else - you get a substantial discount on one item and overpay on another.  Hey. . . they have to keep the doors open and pay their employees to stay in the game. To get the most bang for your buck, concentrate on the items that are great deals at your particular store. And if you’re looking for a big-ticket item, such as jewelry, electronics or travel tickets, take the time to shop around – don’t just assume the warehouse store’s prices are the best.

** Thanks for Visiting.  This post is an FYI. I'm not a Financial Counselor and not giving advice, If you like it, please leave a comment & Share, Share, Share. Don’t forget to follow me on Bloglovin  for new post updates, and on Pinterest**

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