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Vansh Patel on Why Costco Keeps the Price Low

Why Costco Keeps the Price Low

Claims and stances

0:00 Vansh Patel strongly supports: Costco maintains lower prices than competitors by purchasing goods in bulk from suppliers to reduce the per-unit cost for consumers.
0:23 Vansh Patel strongly supports: The combination of low-cost food, affordable products, and a specific retail environment creates a loyal customer base that sustains Costco's long-term business model.

Transcript

0:00 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.