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Want to be a Costco Wholesale Supplier? Consider this

Posted Wednesday, November 9, 2022 in Compliance

Have you ever thought about becoming a Costco Wholesale supplier?

The warehouse that started in 1976 under the Price Club name is now the third largest retailer in the world, according to data from Statista

In the fiscal year 2021, Costco Wholesale Corporation raked in $192 billion from merchandise sales and $3.9 billion from membership fees. (Data from Costco Wholesale’s 2021 Annual Report.)

Costco Wholesale Suppliers Experience Growth

With that data in mind, getting your products into Costco is attractive. 

“Costco is highly renowned for providing consumers with a seemingly endless amount of high-quality products at the lowest possible prices,” Joel Goldstein, president of Mr. Checkout Distributors, writes in a Forbes article. “Furthermore, new product brands have found tremendous growth thanks to the unprecedented reputation that Costco’s platform has to offer to both consumers and distributors.”

Tremendous growth sounds appealing. Before you apply, though, consider the following.

Provide Higher Product Volume

Costco Wholesale suppliers ship higher volumes to the warehouse vs. other retail stores. Therefore, look at your inventory and production to decide if you can handle the higher volume. Are you able to package and sell your item in bulk? 

Lower Your Price

Costco’s big draw is high-quality items at a lower price than anywhere else. Consequently, suppliers must be prepared to sell their merchandise for 15% less in the Costco warehouse and online. Doing so may irk your existing distributors, but it’s the only way to be considered.

Create Unique Packaging

Your packaging should look different from everywhere else your items are distributed. Consider if you have the resources to create materials just for Costco. 

Get a Costco Wholesale Membership

Not a member? To be a supplier, you must have that Costco Wholesale membership card. Gold Star Members pay $60 per year. Executive Gold Star Members pay twice that but receive a 2% reward annually. 

Become a Preferred Costco EDI Supplier

Once you’re in, suppliers must adhere to Costco’s EDI requirements to get their items on the warehouse shelves. You must send EDI documents through a value-added network (VAN). Costco requires compliance with numerous EDI protocols and specific shipping labels. 

BOLD VAN customers are in good hands because we ensure compliance. Is your EDI supplier able to handle the intricacies of being a Costco vendor? 

Costco.com

In addition to the warehouse, you can sell on Costco.com. Interestingly, shoppers do not need a Costco membership to purchase from Costco.com. (However, non-members incur a 5% surcharge.)

Usually, prices are a bit higher at Costco.com than in the store to account for the cost of shipping. For example, the coat shown below is $39.99 online and $34.99 in the warehouse. 

Costco’s online store is not a third-party marketplace, unlike Amazon, Walmart.com, Target.com, and the like. 

Ready to apply to Costco? 

How to Apply

Unfortunately, Costco Wholesale provides very little information on its website about how to apply. 

That’s it. Good luck!

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