The price was pretty hard to ignore. Formula costs a fortune! And this little baby could easily consume 4 ounces in one feeding - at 9 days old. A friend told us to join Costco. Not only did Costco sell Similac in larger cans, they also accepted the $5 Similac coupons we received periodically. In the initial year, we easily regained our $50 membership fee in formula purchases alone.
Once we switched to regular milk, however, I began to wonder if there was any real savings. And if so, how much. Costco's sizes are larger than what you'd find at the other stores, so a simple comparison doesn't work. Last year, I embarked on a mini research project to figure out if Costco was, in fact, worth the $50 membership fee:
- I looked only at household non-consumable goods. I didn't look at food, since Costco brands are often unique and hard to find elsewhere.
- I documented the size and price of 25 common purchases at both Costco and Target (trash bags, toothpaste, shampoo, shaving cream, ibuprofen, Jet Dry, fabric softener, Ziploc bags, etc.)
- I converted each product to a "price per" (price per toothpaste tube, price per ounce, etc.)
- I estimated the # of purchases I would generally have for each product in one year.
- Then I calculated the annual cost difference per product, purchased at Costco and Target.
It turns out, on general consumer goods alone, we save almost $200 per year by purchasing from Costco. In addition, the gasoline savings is always $0.10 - $0.12 per gallon, compared to any other station in the immediate area. If between our two cars, my husband and I fill up 50 times per year, we save an additional $80. And again, this doesn't take into account any food/drink purchases, which definitely add up the savings further. As does the Costco American Express card that recoups 1%-3% of our purchases in cold, hard cash each March. A $200 check right around tax time is a always fun surprise.
It was a lengthy project, and totally nerdy (I know!), but now I can keep my $50 membership card without remorse.
(Disclaimer: Costco had nothing to do with this post. I'm just a research dork sometimes. Maybe someone out there in blog land will find it useful.)
