It states in the Costco listing that they are not a dealer and factory warranty may not appy but they will refund your full price if not satified.

All the big boxers have already met to discuss merging into one huge conglomerate - sort of like an organized family operation. There was a secret meeting in a base hidden under an active volcano a few months ago to study the concept of the 'ultimate store'. Computer simulations were run to test this idea. In the simulation, everything ran smoothly for the first 6 months. Then the government shut the operation down, citing anti-monopoly laws. Each division spun off and became its own entity, again. Then the entities started to recombine, and the whole process repeated itself. This, and the fact that no one could decide who would clean the bathrooms, resulted in the whole idea being scrapped.

By the way, the Ark of the Covenant would only have been available on the website, so at least it would have been easy to find.

COSAMWALDEPOT.....scary!

Oh, you mean like the telecom industry...;)


ROFL

Roght on the money!!!!! You guys need to heed what CCD is saying. I say this all the time, you can buy all your medication online for pennys on the dollar. That doesnt mean its a good Idea! I mean seriously someone wha buys ML speakers from costco is not worth having as a customer. I bet they hook them up to a jvc htib with the 20 gauge wire that came with it. If people cannot see the value in what you do then they are not worth having as a client.

I remember looking into ML and being told there was no more expansion in my area... rebuffed!

I'm sure ML does not authorize this but it is not illegal for Costco to resell. Many years ago... Carver pieces started showing up in our local Costcos with serial number tags scratched off and the page with the serial number missing from the manual. The high ups at Carver made public statement that those products were not under warrantee. Costco replied that they would honor purchases with their own satisfaction policy.I've seen costco take back just about anything... even product with obvious abuse. More clients throw that my way and I'm getting to the point of just paraphrasing what CCD said and letting them get their video there. I sell speakers and electronics but soon they'll be buying real products there in that category. If I can't make money on labor knowing this then it's time to find a new business.

I heard from a very reliable source that ALL of the products that roll through ALL of the Costco's are a complete wash... they don't make a dime off of them once salaries and overhead are figured in. The profit comes from the memberships we all pay for. Think... at least 35.00 X 100 million... I'd take it.

Come on. You know they will go buy some superior MC... Pre terminated of course!
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I remember a few years back when I stumbled onto several pallets full of Denon best 5 disc changer.. [all new condition B-Stock mind you..]

They were $270 at a time when CIs were getting them from AV.. for $399 .. I just had to laugh.
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I think Yoda said it best when discussing a very similar issue with Han Solo in the Empire Strikes Back.

"Sell more goods they will...
Offer fantastic prices they shall...
Provide some much needed value for the people they must...
Connect with their patrons on a personal level...
For that... A very difficult task it will be..."

Let us examine your very reliable source...

Based on yahoo financial, Costco revenue is almost 57 Billion per year.

[Link: finance.yahoo.com]

Since the population of the planet is about 6.6 billion, they've sold memberships to almost every family on the planet. (Remember that almost all families only have a single membership.)

Or your source is a little less than reliable!

By the way, my guess is that your source slings lots of other BS as well.

sure.... Nobody's making a dime on those in jet cartridges. Sure...

They make their money by selling large quantities at a lower profit. And they keep out the riff raff and coupon users by charging a membership fee.

But then, why do I feel I'm pointing out the obvious.

The DVD's... yeah... No profit on them either? They cost more than anywhere!

Unfortunately, your understanding of finance is whats lacking. Costco runs on less than 2% profit margin. They had a gross profit of $6.5 billion and had EBITDA (Earnings before interest, taxes, depreciation and amortization) of $2.1 Billion. Bottom line is $1.1 billion.

So, there may be a lot of truth that the bottom line is memberships only and profit from goods only covers overhead.

At $1.1 Billion, if a membership is $50, then they would have to have 22 million members for rmh's statement to be true. So, how many members do they have?

EDITTED

Costco, as of May 7th, have sold 47 Million memberships at $50 for $2.35 Billion. So yes, the statement is true all their profit, and then some, is derived soley from membership fees. Hope this clears things up.

So if they continued to sell nothing and still paid all their expenses, less product purchasing and replacement and managed to continue collecting their membership fee...

I'm hearing that it wouldn't effect their bottom line.

That there is not a single product that they make a penny on.

That must be why they call it CostCo? You get it at cost?

It really makes me wonder where they get the 2% they give back for all purchases? One of the few but worthwhile perks of the Executive Membership.

Up to $500 a year back on a $100 membership? I'm not good with math, but if everybody got the EX membership and bought so much stuff they each got back $500 checks... It would be finacial ruin for them for sure!

Hmmmm. It would. I think your miising the point.



Your surely missing the point. Look at the financial statements. They had 52B in revenue with 6.5B in gross profit - 12%. The gross profit is selling price less actual cost of the good sold. For example you sell a remote for 300 that cost 200. You have a gross profit of 100 or 33%.

For Cost they average 12%. Some items more, some less but 12 is the average.

They then have 5.1 in adminstrative expenses and operating expenses. You know, the phone bill, heating bill, CEO pay, rent.


Kinda but its a little misleading. They dont sell for raw cost but net costs. Do you know the difference? I'm not being smart but this is a salent point that usually causes many business owner wannabees to go broke.

Your probably an employee and call BS when your boss says his "Cost" of labor is $60 per hour when your only making $20 or 25 an hour. If I sell a job at "cost" they get billed $55 an hour, my true cost, even though that is above my "raw" cost.


First, they get $100 for that and they have a percentage figured in the cost of doing business for credit card purchases. Discover doesn't go broke paying it. I must admit though, I am not intimately familiar with the program.


Not quite. The math of this is beyond the scope of the conversation.

ML just wouldn't do that! Costco probably bought out VERN's HI FI Hut that was in financial trouble somewhere in Mississippi or whatever...

I can just see the refund line now.. disgruntled guys who took home ML's and tried to run them with their AKAI receivers!!!

A friends wife is pretty high up in the Costco Empire... They DO only average about 8 to 12 % markup... but due to their sales VOLUME, they manage to make a few spare nickles here and there!

Revenue is up there but that doesn't report costs. Sure they sell it for a markup... especially man sized bags of Toilet Paper, etc.

I do 3/4 of a million a year but I sure don't have that left after expenses (or even a 10th of it).

Overhead for an organization like Costco is high... and you can bet some extremely smart financial wizards are working the equation... I can't name the source but I certainly consider it reliable (remember HQs in my neck of the woods).

Just to argue semantics only, I think it would be better put to say that they "run" on a gross profit margin of 12% (I'm using your number and assuming it's accurate, I have not looked at their annual report) and the result is a 2% net profit.