The opening of warehouse shopping giant Costco’s first Australian store in Melbourne this week has attracted extensive media coverage and hordes of shoppers. Bargain hunters appear to have been seduced by massive mayonnaise and industrial palettes of paper, but there are some good discounts when it comes to tech purchases too — especially if you’re thinking iPod.
“That has to be good value,” the man comments as he contemplates a 950 gram bucket of Vegemite ($11.69). “But how often do we use it?” his wife responds as she stares into an already-overflowing trolley. And really, that’s the Costco dilemma in a nutshell.
Costco’s giant warehouse shops (and similar rival chains) are a staple of the North American retail experience. The 14,000 square metre site in Melbourne’s Docklands is the chain’s first move into Australia, though other sites are expected to follow (Sydney’s Auburn being the next likely location).
The core element of Costco is “stuff is cheap because it’s in big quantities”. That works well for business customers, and it also appeals to bargain-minded buyers who are happy to purchase non-perishable goods and have the space at home to store them. Outside of that, the value equation is a lot more individual. If you really do eat a lot of hummus, then a 1kg container might make sense, but for many people it’s likely to go off before you finish it.
In any event, my main area of curiosity at Costco is around the gadgets and tech supplies it has on sale (which are the first things you encounter when you enter the store). In this area, there’s also some good savings to be found, but within well-defined parameters. There’s only a handful of brands and items on display (far less than you’d find in a typical Officeworks), and the level of savings very much depends on the category.
There’s a healthy queue of shoppers for the photo printing service, which at 12 cents a print is the cheapest I’ve seen in a retail location. However, cheaper deals do sometimes show up with online photo stores.
Less distinguished is the offer of 100 Sony CD-R discs for $25.99. It’s not that it’s a terrible price, but you can get a similarly priced spindle at almost any office supplies store, discount chain or white box PC retailer.
Apple is rarely generous with its discounts, but the iPod prices when I visited were actually lower than from Apple’s own online store. An 8GB Nano was $174.99 (versus $199 at Apple), while the 8GB Touch was $294.99 (against Apple’s $329). The full 32GB Touch is $499.99 (Apple charges $549).
The PC range is a bit limited and costlier — there are just two netbooks on offer (the Acer Aspire One for $649.99 and the HP Mini 10 for $599.99). Both those models can be found for less at other retailers with pretty minimal searching, and that’s before considering options such as negotiating for a discount, a definite no-no in the Costco environment.
The same applies with other models: the Toshiba Satellite A500 is $2299.99, a price which seems easily bettered with a quick search at staticICE.
Printer supplies are priced much the same as they are everywhere, and I could only see HP, Epson and Canon on offer — hard luck for Lexmark, Brother or other less dominant brand buyers.
The same applies to storage media. A 1TB WD MyBook for $182.99 is a good buy, as is a 250GB Seagate FreeAgent for $99, but again you can find similar (and sometimes cheaper) deals from many other locations. $58.99 for a 16GB SanDisk USB stick is actually tending towards the high side these days.
Conspicuously absent? Mobile phones and any form of software. The former isn’t too surprising, but the latter is a slightly odd omission (though I’d have to allow for the possibility it was hidden somewhere near dog food and I missed it).
The bottom line? If you were already going to be in Costco anyway, then many of these purchases might make sense, and the savings are quite impressive in some cases (the iPods particularly). But for highly specialised shopping (such as a PC), you’d still be better off going to somewhere either more convenient or where you can get actual service if things happen to go wrong.
Here’s some other general tips:
Sher Arbiter
August 20, 2009 at 12:29 PM
I understand what you mean about the prices, but I heard Costco has a very good return policy on electronics and computers and televisions. Is this true?
Report PermalinkJustin
December 31, 2009 at 4:10 PM
Costco has the best return policy. 90 day return policy on computers, cell phones, mp3,televisions, cameras, camcorders, and projectors. Everything else can be refunded for a full refund of purchase price anytime. *Even Years* You don’t even need a receipt.
Report PermalinkElly Hart
August 20, 2009 at 12:59 PM
I have to ask the question: Did you buy anything?
Report PermalinkCraig Baldie
August 20, 2009 at 1:56 PM
I went along on Monday for the opening night. Bought quite a few things including a slab of Mother energy drink.
Report PermalinkFrom what i read about the returns policy is that you can return any item if you are unhappy with it or if you change your mind…
but dont quote me on that
Alex
August 20, 2009 at 3:08 PM
Software was there, but up with the books. The selection was pretty poor though.
Report PermalinkMichael Xion
August 20, 2009 at 3:19 PM
Given their returns policy and quality of goods. For value-for-money, it doesn’t sound like costco will damage Aldi much.
Report PermalinkChris
August 21, 2009 at 3:29 PM
Aldi and Costco operate in completely different market segments. Aldi are aimed firmly at consumers and stock most of their own brands whilst Costco are aimed at businesses and don’t (to the best of my knowledge) stock their own brands.
The similarity between them is that they’re cheaper than Coles and Woolworths. Those two have a duopoly which has conditioned the average Australian consumer to believing that their ‘bargains’ really are bargains.
I’m hoping that the arrival of Costco and the growth of Aldi will cause other overseas reatailers such as Tesco to come to these shores and further drive down prices and improve quality.
Report PermalinkDen
August 21, 2009 at 10:04 PM
Costco has their own brand, called Kirkland.
Report PermalinkSteve Z
August 20, 2009 at 3:55 PM
We love Costco here in the States. They do have great return policies and they actually pay their employees a nice wage, unlike Walmart. The prices are great, the selection weak, and they never carry low quality items.
Report PermalinkA
August 20, 2009 at 4:47 PM
What about the TV’s ????
Report PermalinkMike Williams
August 20, 2009 at 10:19 PM
I lived in Seattle for a few years and a Costco shopping trip was a must every month. It was a bit easier to make use since I had a basement for storing the year’s supply of toilet rolls in a bag and such, but they also had some great produce, a fantastic wine department (bins of Grange Hermitage!) and great IT stuff. Aldi doesn’t have a bar on it.
Report PermalinkMorgan Lupson
August 20, 2009 at 10:37 PM
Isn’t anyone else worried that all the profit is going straight to uncle Sam. ?? Like sure things are cheap, but it’s not Aus Owned.
Report PermalinkCameron Adams
August 21, 2009 at 1:14 AM
Wesfarmers is the largest retailer in Australia (Coles, Bunnings, Target, KMart, Officeworks, etc). Not much Australian stuff on their shelves. I don’t see that as a good thing either.
Report PermalinkDave
August 21, 2009 at 10:39 AM
I really think this will benefit the Australian consumer(that’s us remember) anyone who would say different is very likely to be a Woolworths or Westfarmers share holder good luck to you, you should be happy you’ve made your profit.
Report PermalinkI personally don’t mind seeing some profit going offshore, Australian businesses should see this as an opportunity to gain access to a global retail chain for Australian made products.
Buy some shares in Costco if your so worried.
Shan
August 21, 2009 at 12:47 PM
When Safeway/IGA clean up their stores, stop treating their customers like criminals (ex: requiring a dollar coin for use of a cart), and stop selling moldy produce, I’ll buy my food there. And don’t get me started on Coles… the Elsternwick store is the most disgustingly dirty supermarket I’ve ever seen!
Report PermalinkChris
August 21, 2009 at 3:40 PM
Hey Shan, I agree with what you’re saying except for the gold coin part. The requirement for customers to deposit a coin has two benefits.
Report PermalinkOne: retrieving trolleys is easier and quicker. This reduces the need for them to have a (paid) employee collecting trolleys: a saving that they can pass onto you.
Two: it reduces the number of trolleys dumped. It’s not a major problem in Australia but they are a particularly obnoxious form of litter in many European countries.
jason
August 21, 2009 at 11:52 PM
Chris i would suggest you contact the CEO of Coles Ian McLeod regarding the Elsternwick store.
You know the first thing that Ian notice when he walked into a coles supermarket. He notice how unclean it was. And i imagine this was a bit of a culture shock for him coming from the UK where the supermarkets are clean.
Report PermalinkSam Testa
August 21, 2009 at 1:30 PM
Bring it to Perth!
Report PermalinkAldi too.
Mark
August 22, 2009 at 6:18 PM
Coles & Woolworths have been ripping us off for years. I bet their prices will drop now. Personally I’m glad i have somewhere else to shop now.
Report PermalinkPhilip Steinke
August 24, 2009 at 11:31 PM
What songs do visitors have to sing?
Report PermalinkPat
August 25, 2009 at 9:52 PM
What a waste of $60 – once you factor in parking, membership, fuel – what discounts are you actually receiving…..but thanks costco I assume the parking across the road at habour town are now going to take their cut and match your parking fees…no more $5 flat rate…
Report PermalinkJosh
August 27, 2009 at 9:25 PM
I do wonder about people in our society when they are lining up to visit a retail store, especially one that is basically just a big warehouse hanger that you have to pay a membership to, to be allowed to actually buy anything.
Report PermalinkLouise
August 29, 2009 at 9:39 AM
Dick Smith had 12c photo printing a couple of weeks ago and I didn’t have to cue or pay $60 for the privilege.
Report PermalinkKoneko
September 25, 2009 at 3:12 AM
I wonder what AUSTRALIAN products are
Report Permalinkwhen people concern about COSTCO carry Non OZ products
you go SAFEWAY COLES
there are many items are imported from other countries getting more and more ….
Even Healthy Dry apple for little one.
We could not produce here ??
Seafood Fish
aren’t we surrounding by the ocean?
or
all these BIG BRAND supermarket exclusive to high profit products and selling low cost products…?
Quality ? Why we are paying more than we should?
Competition… No competition
and we have NO CHOICE
have to pay to SURVIVE