Luca Pietro0:00 Have you ever wondered why Costco is so much cheaper than other competitors and other grocery stores and other wholesalers?0:07 Well, obviously there's a few main reasons that everyone's pretty much aware of, such as the fact that they're buying bulk from these suppliers, um, allowing them to decrease the cost that they're selling to consumers at.0:19 Um, however, there's a couple of things you might overlook.0:22 First of all, we start with their iconic food court that sells hot dogs for $1.50, pizza slices for a couple bucks, and uh lots of variety of other things.0:32 And this is a huge value proposition because you know, when you're at the grocery store, you're getting all your things you need to.0:40 Um and then you also have if you want to get food, you need to go somewhere else.0:44 Versus a Costco, it's all there.0:46 You're gonna be at Costco for an hour or two if you're shopping there usually.0:49 Uh so it's nice to be able to have that convenient cheap alternative right there.0:53 On top of that, Costco is one of the few wholesalers who doesn't pay for labeling and shelving space.1:02 Uh this really is evident in their stores.1:04 Their employees aren't restocking shelves constantly, so they don't have to pay for the labor, they don't have to pay for the shelf space.1:11 They just take the pallets that come in through shipments and lay them out on the floor in a super strategic manner, um, and making it a maze almost so that you have to walk through the entire store uh to get everything that you need if you're getting a few different things.1:24 So uh some interesting things about Costco, let me know what y'all think.
Wesley Joyce0:00 Luke, you bring up a great point about um brought up a few great points, but I think um the food court is really the biggest sell, especially with recent um TikTok trends or whatever.0:13 Um as goofy as they are, they do sell um and how that's caught on with Costco.0:19 And I think that that um market strategy is also very clearly seen at IKEA as well.0:26 And the in the maze at IKEA as well.0:30 And I have a Costco does a very good job.0:32 I'm a very big fan of theirs and I appreciate spending money with them because you know what you're gonna get, you get it at a good price, and I do appreciate their efficiency as a co as a company and uh how easy it is for us to get stuff cheap.0:43 But that just makes me think about IKEA and how the place is truly a maze.0:48 And you know, their their design, I mean, I wonder how much time has gone into how they build those buildings.0:55 Um I mean it's literally a Lego kit the way they hang their ceilings and you can make whatever room imaginable.1:03 Um so yeah, I uh um IKEA's always amazed me and their food court is also I would say maybe not in America just as iconic, but um, you know, they lean into their Swedish heritage and you know the the meatballs and how they do their hot dogs and everything and like I I can I can think of going to IKEA just to g get lost in the maze and go to the food court.1:26 So um yeah, definitely and you know these are these are cool things for us to enjoy, but I also just really appreciate both companies for um remaining cheap and helping us out.1:40 Like I'm happy to go spend money with them.
Vansh Patel0:00 Luca, I think you bring up an excellent point on why Costco I think is seen as the backbone to most products in America.0:10 I mean you look at groceries and you just look at other necessary things that most people buy on the day-to-day basis.0:18 I think Costco is an icon in what most people shop at.0:23 And I really like how Wesley also brought up the uh example of IKEA and how that runs on a similar business model with the food courts and how a lot of these places they attract customers because of their cheap food and they create a loyal fan base because of their cheap products and because of the environment when you go into one of these businesses.0:48 But I wanted to bring up another point about Costco and Sam's Club as well, is their gas.0:55 They uh they buy in such bulk quantities that they're also able to produce the lowest gas price in most regions.1:04 I mean, when you look at the average gas station versus a Costco, they're about ten to fifteen cents different on average.1:14 So I think all those combinations allow them to be an effective business model and that's why they've lasted as long as they have.