Ever driven to Costco just to get a mouthwatering rotisserie chicken? At just $4.99, it’d be stupid not to – even when you factor in the cost of gas. But when you next chow down on one of these bargain birds, consider this: there’s a big price being paid. And you eventually may be the one having to cover that cost.
You won’t be confronted with that price at Costco, of course. Rotisserie chickens have remained at a steady $4.99 there since 2009.
And plenty of the birds are flying – although not literally! – out of the doors. We know this because a Costco boss spilled the beans.
In a 2018 interview with NPR, Costco head of external affairs Jessica Kolterman revealed something astonishing. At that time, the big-box store was selling about 60 million chickens each year in the U.S.
alone. That’s a whole lot of birds! And it means either the retail giant is missing a trick when it comes to profits – or it’s gone to extreme lengths to secure this price.
But despite growing concern about the brand’s birds, they have become somewhat of a cult item. They even have their own Facebook page with over 18,000 followers!
Not everyone is so smitten, though, and that could be because they know how Costco secures such a plentiful flow of chickens on demand.
It’s weird, too, that Costco is adamant about keeping the cost of its chicken down. Many members wouldn’t quibble about paying an extra dollar or two on top of that $4.99.
We bet sales wouldn’t be much affected, either. So, could the whole thing be an error? And is it Costco that’s having to pay the price?
As one of the largest retailers in the world, Costco has its price points all figured out. That means the low cost of the chicken definitely isn’t an error!
It’s been carefully analyzed and discussed. But $4.99 is the amount the company will continue to stick with.
Even more puzzlingly, as competitors have historically had to increase their prices gradually, Costco hasn’t budged, something customers tend to give two thumbs up. Although, it’s this decision that hints at a darker truth.
It begs the question: if Costco doesn’t have to eat the cost of the chickens, who does?
Obviously, Costco isn’t making all its profit through the chickens alone. How can it when the birds are so cheap?
Maybe there’s something else that Costco is buying low and selling high to make up the shortfall. Maybe it’s the producers of that item who are paying the big price.
Well, you might be surprised! According to Costco's CFO and executive vice president Richard Galanti, there is no secret weapon in the company's arsenal.
It's quite the opposite. The wild truth is that the store continues to lose money by selling the chickens at bottom-barrel prices. And we mean a lot of money.
It turns out that the rotisserie chickens have been setting Costco back somewhere between $30 and $40 million each year. And even after divulging this staggering sum, Galanti remained blasé about the company's decision to stick with its $4.99 price, saying, “That’s us, that’s what we do for a living.”
But what exactly is it that they’re doing?
However, don't think Costco hasn't weighed this risk carefully. According to Galanti, the firm’s finance supremo, Costco has consistently been willing to “eat” close to $40 million in revenue.
This is supposed to reflect the business’ commitment to good value for its customers. This sounds almost kind and caring, right? But there’s a sinister truth behind those cheap birds.
Not everyone is impressed by Costco's consistently cheap chicken. In 2019, the non-profit Food & Water Watch left a scathing review of the retailer’s controversial approach.
In an article on its website, the group claimed, “Costco has been plotting to... wreak havoc on Midwest agriculture so they can keep their hot ticket item cheap.” A pretty bold statement!
Regarding the low-price tactic, Food & Water Watch essentially suggested that Costco is exploiting someone somewhere down the line to maintain the loss. After all, they aren't in the line of doing good deeds for good deed's sake.
So, it likely comes as no surprise that remaining firm on the $4.99 price point has benefitted the company over time.
Let us explain! The scrumptious rotisserie chickens likely work as a lure for customers – or a ‘loss leader.’ By keeping the rock-bottom price artificially low, the highly popular chicken is guaranteed to be in hot demand.
And luckily for Costco, that risky move seems to be paying off. According to figures in a 2014 edition of The Seattle Times, sales come in at close to one bird each for every one of the 78.7 million Costco members.
And by setting itself apart from its competitors by pricing low, Costco guarantees a higher footfall in its stores. So, despite losing out on a few dollars per chicken, the company makes up for it with customers’ other purchases once they’ve stepped through the doors.
Makes sense, right? How many times have you gone into a supermarket with just one thing in mind, only to be enticed into buying more than you needed?
It’s the same deal with the chickens. For example, by placing the coveted birds at the very back of the store, Costco hopes consumers are tempted to pick up other products they pass along the way.
But this merely scratches the surface of Costco's sneakier tactics, including one concerning its signature rotisserie chicken flavor.
Take the taste of Costco’s chicken, for example. It’s not bland, meaning the company must have some special flavoring secret at its disposal.
But as this costs money Costco doesn’t have, what gives? Well, the answer lies with an injection that takes place before the birds have even made it to store.
Each bird is pumped with 460 milligrams of salty liquid. That’s close to a third of your recommended daily intake of sodium, according to the American Heart Association.
Yup, if you’re partial to eating a chicken all by yourself, you may find yourself over the salt limit. And that makes us wonder what else Costco is willing to disregard to turn a profit.
The real secret? Costco’s had to make a controversial business move to sell its popular chickens.
You see, according to the USDA, the number of whole birds sold has fallen from 50 percent in the 1980s to just 15 percent today. And so to get the amount of chicken it needs, the big-box store has had to take things into its own hands.
Over the last 50 years, birds have been bred larger and larger to supply the growing appetite for portioned cuts of meat. Unfortunately for Costco, though, these chickens aren’t a good fit for the rotisserie.
And with the global supply chain no longer an option, the wholesaler had to return to the drawing board. Its approach has caused a real furor, too.
Basically, Costco needed to think faster and think bigger than ever before. And its solution, without compromising on price, was this: an entirely new company, a total overhaul of its business model, and a staggering $450 million investment.
Not dramatic at all! But what did it have to do with chickens?
Well, in order to maintain an ample stock of chickens of the proper size, Costco decided to monopolize the chicken production process – right down to the hatching of the eggs.
The monumental business venture came to life in Fremont, Nebraska, and it didn’t materialize without backlash from the local community, who have proudly farmed the area for generations.
It was a controversial move. Ultimately, this new business was set to provide a staggering 40 percent of Costco’s annual chicken supply.
That’s about 100 million chickens every year! And the threat of such an imposing plant – all 400,000 square feet of it – was indeed felt by those who lived nearby.
The company formed to deal with Costco’s mammoth move into farming, Lincoln Premium Poultry, had its potential sites positioned on the border of Iowa and Nebraska. But that’s a place already brimming with factory farms.
As of August 2018, in excess of 10,000 of these facilities were already functioning in the area. No wonder the locals fought back.
Ruth June had relocated to Nebraska in 1962 with her late husband Bob, and she had always loved the peace in her neck of the woods. In a 2018 interview with Nebraska Public Media, she said, “This is a nice, quiet neighborhood.
Nice people. Everybody gets along.” Until Costco got involved, that is. She predicted, “Now, we’re going to be shut up in our houses because we can’t stand the smell outside?” Fair point.
And Kolterman didn’t do much to dispel Ruth’s concerns about lingering odors, “I’m not going to sit here and tell you you’re never going to have a smell in the course of this operation. It’s a farm...
That’s just the nature of agriculture,” the Costco boss replied. But a bad stench in the air isn’t the worst issue.
There’s the environmental impact to consider, too. Randy Rupper was part of the local group Nebraska Communities United, and he was concerned about the grim reality of all that manure.
In 2018 he claimed that “millions of pounds” of the stuff would cover the surrounding fields. Unfortunately, manure means chemicals, which equals a whole lot of nitrogen and phosphorus making its way into local waterways. And that’s very bad news.
When water from a farm infiltrates other waterways, this is known as farm runoff, caused by rainfall or irrigation. Farms often produce potassium or nitrogen from fertilizers, pesticides, and even certain metals.
And you may have already guessed what can happen when these chemicals come into contact with our water sources.
Yep, you guessed it – pollution. And it’s one reason why Food & Water Watch was particularly opposed to Costco’s mammoth new plant.
According to the non-profit, the area was already crippled by what it described as “severe pollution” from intense industrial agriculture in the Midwest. Apparently, over 1,000 miles of streams and rivers had already been harmed as a direct result of factory farming. But it doesn’t end there.
The adverse effects of farm runoff have also been seen at several state park beaches. Food & Water Watch found that in 2017, the advice at 37 bathing spots was 'Swimming Not Recommended.' And according to the National Water Quality Inventory, this form of pollution was one of the leading causes of contaminated water in 2000.
Worryingly, this is still true more than 20 years later.
But there's a simple solution here, right? Just avoid swimming in those waters, and no harm is done.
Well, the issue is not quite so simple. Iowa – the state located directly next to the new sprawling Costco poultry facility – has already felt the effects of factory farming on its drinking water supply.
The Des Moines Water Works is Iowa’s largest facility for treating drinking water, and it’s revealed the disturbing effects of industrial-scale farming on the surrounding community. In 2015 nitrate pollution surpassed federal limits in 11 of the state’s water supplies.
And in certain conditions, that can be extremely dangerous. It’s no wonder that Nebraskans feared the effects of mass farming in their own region.
Nitrate pollution has volatile effects on the body once it's been ingested. Specifically, this type of water pollution has been linked to birth defects and certain types of cancer.
But for the citizens of Fremont, Nebraska, the health risk was far from the only bone they had to pick with Costco.
Costco’s choice of location for its state-of-the-art poultry facility wasn’t made by sheer chance. The company selected Nebraska as their base, understanding it is one of the U.S.’ largest agriculture states.
For its new business to prosper, the bulk chain store would have to get some of the local farmers on its side.
Seeing as one in four jobs in Nebraska are agricultural, this shouldn’t have been too hard a task. But while Costco was offering 15-year contracts to participating farmers, there were still widespread concerns that signing the dotted line could see them exploited by the mega-corporation.
Skepticism was high. Basically, these deals could trap folks in an unfavorable position.
A young farmer in the area, Marshall Lutjens, raised a concern that was shared by many. In 2018 he told NPR, “My biggest thing is if something ever happened to the company, who's going to fill the barns?
Because you're putting a lot of money down for barns.” In other words, should any unforeseen circumstances crop up, there would be little to no compensation offered to the farmers. And with the livelihoods of so many farmers hanging in the balance, it’s clear that Costco’s low prices really do come at a cost.
These honest, hard-working folks could be left high and dry – and it would make barely a dent in Costco’s profit margins, even with their low-priced chickens. But there’s a more obvious threat posed by the intruding company.
And it’s all to do with Nebraska’s time-honored farming system of family ownership.
Here’s the deal. After the Costco project was launched, a North Carolina investor applied for ownership of a staggering 132 chicken houses.
A generous investment, right? Seems great. The only issue is that North Carolina is more than a thousand miles away from Nebraska. And locals are concerned about these absentee owners for good reason.
Andrew Tonnies lives in Dodge County, and he was worried that people investing from out of state would be less likely to have the best interests of the community at heart. In 2019 he told the website Food and Power, “These people coming in… are they just interested in the economics of extraction?” And he has a point.
Before the plant was even being built, local farmers were reportedly already being pushed out of their right to farm ownership by wealthy folks with their eyes on the prize.
So it seems the true cost of Costco’s rotisserie chickens is a far cry from their bargain price tag. Only time will tell whether the farmers involved in the project will be exploited, or whether the local landscape will be drastically impacted by pollution.
For now, though, let’s take Lincoln Premium Poultry at its word and hope it will stick to its seemingly sound code of ethics.
The next time you're in a Costco store, listen for a ringing bell. At various points during the day, that sound signals the staff have just put out some fresh rotisserie chicken.
Quite a way to announce it, right? And thanks to their low prices, they’ll disappear fast. But read on for more ways to take advantage of Costco's low prices, and to stay ahead of their sales tactics.
When looking at the price tags of your favorite items at Costco, have you ever noticed an asterisk on them? If so, take note.
According to Delish.com, an asterisk indicates that they won’t be coming back to the shelves once the current stock has sold out. Uh-oh. Be sure to grab what you can, then. You don’t want to waste time searching the aisles in vain on your next trip!
For many customers, the pumpkin pie at Costco is arguably the store’s best product. And we can understand why.
For one thing, it’s huge! You could feed a lot of people with this tasty monster. Then there’s the price. Incredibly, the pie will only set you back by $6.99. It used to be $5.99, but that’s still an impressive deal. Don’t sleep on it.
Nowadays, prescription costs can make a real dent in your budget. They’re no joke!
Mind you, that’s not the case at Costco. The medications on offer at its pharmacies are so much cheaper than at a lot of other places. And it isn’t just restricted to Costco members, either. You see, these excellent deals are open to everyone. How cool is that?
Sometimes, it can be easy to dismiss Kirkland items when browsing Costco’s shelves. Surely the brand names are better, right?
Well, that might not be the case. As per the Consumer Reports organization, customers often hail the quality of Kirkland’s stuff and suggest it beats a lot of other brands at the store. Plus, it’s cheaper. You can’t top that kind of feedback!
If you don’t have the Costco app installed on your cell phone, now might be the time to change that. This application houses all of the latest discounts and offers that you’ll find at your nearest warehouse.
Nothing gets ignored. It’s a truly awesome tool. Think of the time and money it could save you on the next shopping trip!
When Costco’s at its busiest, it can be extremely difficult to search for the best deals at the store. If it’s becoming a problem for you, here’s a tip to consider.
According to Money Crashers, mornings are the perfect time to explore the warehouse. There won’t be huge crowds blocking the shelves while you mull over the latest offers.
Okay, you might need a pen to jot this down. The pricing at Costco isn’t random, especially the final two digits.
For instance, a price tag that ends with 97 cents highlights that the product in question has been marked down. Meanwhile, figures ranging between 49 cents and 89 cents come directly from the brands, as part of a “special price.” Still with us? Awesome!
You can’t go wrong with Costco’s meat selection. Not only is it cheaper than a lot of other stores, but the overall quality is unmatched as well.
Don’t just take our word for it. Prime + Proper’s “executive butcher” Walter Apfelbaum told Food & Wine, “Costco sells some of the most beautiful prime beef I’ve seen out of the restaurant industry. They have huge buying power.”
We don’t blame you if the prices of certain brand name products make you wince. They can get pretty high!
But guess what? There are times when Costco will include some of that stuff in offers around the store. For instance, in the summer of 2021 customers could get their hands on a Cuisinart ice cream maker for just under $60. That’s a great deal.
Who doesn’t love Costco’s free food samples? With one bite, you can tell if an item’s worth picking up or not.
We can only imagine the amount of money customers have saved over the years using that method. So when’s the best time to visit those stands, then? According to Money Crashers, more samples are available “during peak hours” at the store.
When you spot a product that’s part of an awesome deal at Costco, do you grab it straight away? Or leave it for another time?
If you often go for the latter option, you could be missing out. You see, unlike at other grocery stores, these items won’t necessarily be staying on the shelves forever, especially at a lower price. So capitalize on the offer and save some cash!
Looking to buy a unit to store your wine? Well, you might be able to pick some up for nothing on your next trip to Costco.
All the bottles arrive at the store in wooden cases before being put on display on the shop floor. Once the boxes have been emptied, they’re usually thrown out. But if you ask, you could walk away with a set — free of charge!
You can always find some excellent bargains in Costco’s seasonal sales. It’s a real feast for the eyes whenever you walk through the door.
But which of them are considered the best? Apparently, summer holds the crown. The offers on things such as swimming pool products and outdoor furniture are ridiculously good during that time. They’re almost impossible to ignore. So stay alert, folks!
Costco and bulk buying go together like peanut butter and jelly. That’s got us wondering, though — what are the best items to pick up in bulk?
As per Money Crashers, “pantry staples” are an absolute must, such as eggs, butter, vegetable oil, bread, and rice. Compared to other stores, you’ll get more bang for your buck grabbing these at the famous warehouse.
With the price of fuel going up, more motorists are being mindful of where they get their gas today. On that note, Costco’s stations are well worth a look.
Money Crashers reported that the “per-gallon savings” were between 5 and 20 cents compared to nearby fueling spots. That’s pretty significant in the long run! Why not drop by on your next visit to the store?
Want to grab a bite to eat at Costco without breaking the bank? Well, this will be music to your ears.
The warehouse sells a delicious hot dog and soda combo at the food court. Seriously, it’s great! And the price tag? Only $1.50. Wow. It’s arguably one of the best value for money deals across the entire store.
Travel agents? Not for you!
Costco members don’t need to head to their local agency to sort out holiday arrangements. Instead, they can get it all organized at the warehouse store through its “travel services department.” Nice. The workers offer up some excellent deals on accommodation and plenty more, saving customers a lot of money. If you’re planning a vacation, give them a try.
Costco’s giant teddy bears are the real deal. There’s no false advertising here — these things are over seven feet in size!
So are they worth the hassle? You bet! Kids will have hours of fun playing around with the huge cuddly animal, making full use of it. You probably won’t have to splash out on new toys for a while, much to your wallet’s relief.
As any wine connoisseur will tell you, bottles don’t always come cheap at the supermarket. In fact, some of the prices will leave you rubbing your eyes in disbelief!
Yet the price tags at Costco are a lot friendlier. In addition to the Kirkland offerings, all the other wines are up to 20 percent cheaper than the standard market price.
How about this for a fascinating tip? Lifehacker revealed that Costco’s most expensive items are usually found scattered across the middle aisles due to the level of customer “traffic” in those spots.
So you’d be hard-pressed to notice any worthwhile deals. Instead, focus on the bordering aisles at the warehouse. Your wallet will feel more at ease there!
After enjoying the hot dog and soda combo at Costco’s food court, you might fancy a delicious dessert as well. With that in mind, give the plant-based acai bowl a try.
The store rolled these items out back in 2018 and they’re still going strong. You can pick one up for just $5 today. Trust us, they’re worth every cent!
Is there anything Costco doesn’t sell? Motorists can pick up new tires at the store when they need them, as well as get them installed.
If you factor that in, it’s still usually cheaper than visiting a local mechanic. But this is what really takes it over the top. Costco’s add-ons are very impressive. You can get lifetime maintenance for nothing, and a “five-year road hazard warranty.”
Before you jump in the car and head off to Costco, grab a snack from your kitchen cabinet or fridge. Why’s that?
Well, shopping on an empty stomach is a very bad idea, especially if you’re trying to save money. Hungry customers are prone to picking up items that aren’t on their original lists. Food in particular. So fill up at home!
For those of us who celebrate Christmas, December can be an extremely expensive month. From the food to the presents, it’s pretty intense.
Mind you, decorations can be picked up for a fraction of their original cost at Costco a few months before. Yes, the store usually pulls out the previous year’s offerings at that time. Don’t sleep on those deals!
To say that Costco’s range of spices will leave you spoiled for choice is a major understatement. Seriously folks, the shelves are loaded!
Chopped onion, cinnamon, garlic, turmeric — take your pick. And if that isn’t enough, they’re not particularly expensive, either. You could easily stock up without destroying your shopping budget. So take advantage of the friendly prices if you can.
Do you receive Costco’s coupon mailers every month? If so, make sure you give them a good read prior to heading to the warehouse.
That way, you can pinpoint the discounted products that you want without searching for them on the shelves. This method will also steer you away from making impulse purchases, too, which is never a bad thing.
While we love browsing book stores, some of the prices can be more than a little off-putting. It’s not like that at Costco, though.
The store has a huge selection, from fiction to nonfiction. And the offers are awesome. You’ll rarely ever overpay for a book during your visit. So if you’re an avid reader, check those areas out. You won’t be sorry.
Given the wealth of choice shoppers have now, it can be really difficult to know which stores boast the best offers. On that note, Costco is a big help here.
Its website includes a function that allows you to compare the costs of certain items with the competition. We’re talking places such as Walmart and Home Depot. What a great idea!
Why visit a florist to pick up an expensive arrangement when you can go to Costco instead? Yep, the famous store sells flowers as well.
And you can get some excellent deals on them. It’s the perfect place to go if you’ve got a big celebration coming up, as you can grab bouquets in bulk. You’ll never be left short.
Food shopping can be pricey enough as it is, but organic products will really push your budget to the limit. The price tags aren’t kind.
At Costco, though? It’s a different story. You can spot plenty of welcome offers in the food aisles. Apparently, the store’s organic beef is especially cheap when compared to other shops. So don’t be shy. Check out the selection.
Before you buy something in bulk at Costco, you want to make sure that its value for money beats a normal purchase elsewhere. A sensible approach, wouldn’t you agree?
Anyway, following previous experiences, Money Crashers revealed that items such as trail mixes and snack bars were perfect for bulk orders at Costco. Plus, peanut butter and pasta sauce made the cut, too.
Want a helpful bit of advice before your next trip to Costco? Okay then — don’t be put off by the valuation of the gift cards at the store.
As it turns out, you won’t have to pay the full amount once you reach the checkout. According to Reader’s Digest, you can get up to 25 percent off the price. That’s a tremendous deal.
Don’t you just hate it when you’ve got to prepare an elaborate meal at the end of a long day? It sucks!
But Costco’s doing its bit to make lives easier. The store has a big prepped food section that sells “pre-assembled” and “pre-cooked” items for decent prices. So browse those shelves and think of the hours you could save throughout the week by picking a few things up.
In case you didn’t know, Costco’s Gold Star membership will set you back by $60 each year. There’s another tier, though — the Executive membership.
It’s double the cost. Mind you, it’s an upgrade worth considering. As Money Crashers outlined, customers get two percent cash-back on the majority of their shopping. Plus, by splashing $3,000 over a 12-month period, the store gives them a “reward” worth $60.
There’s nothing more annoying than seeing a product go on sale just after you bought it. Why didn’t the deal drop earlier?!
Then again, there’s no need to fret if that happens at Costco. Whether it’s online or at the store itself, you can get money back so the purchase lines up with the current price. What a great service!
Need an eye exam? Well, head over to the nearby Costco.
Non-members are allowed to visit the store’s eye doctor. You can also buy vision insurance there, with FinanceBuzz noting that the cost is roughly $70. That’s not bad at all. As for Costco’s members, they get a host of benefits. For instance, the prices of optical purchases are all slashed online.
Yes folks, you can buy home and car insurance through Costco if you’re a member. It’s all managed by CONNECT, powered by American Family Insurance.
And boy, are the savings something. FinanceBuzz claimed that new customers often save $600 on average at the end of the first 12 months. We wouldn’t blame you if you thought about joining!
For those of you who have big celebrations planned in the coming weeks, pop on down to Costco. There’s a certain product in the food aisle that you should definitely pick up.
We’re referring to the store’s sheet cakes. Not only are they absolutely huge, but the prices are shockingly low, too. You can buy one for just under $20. We’re serious!
This might come as something of a surprise. When you buy electronic items at Costco, the store will offer you free tech support in a phone call if need be.
Yet that perk isn’t widely advertised around the warehouse. As Eat This, Not That! put it, it’s a “semi-unknown deal.” Oh, and you can get added extended warranties for nothing as well.