Understanding Costco Memberships: Business

A step above the Gold Star Membership is Costco’s Business Member option. Business identification is required when applying for this kind of Costco membership. For $55.00 you can purchase the regular business member, or for $110.00 you can be part of the Executive club and earn rewards. Licensed businesses, nonprofit organizations, government agencies, farmers, and ranchers can all join as a business member. It includes a card for your spouse and additional membership cards cost $35.00 each.

Prices are subject to change and may vary by region, check your local warehouse for exact cost. If you are a supplier who is seeking to bring your product into a Costco warehouse or is interested to begin the process, VendorCo can help.  Call us at 949-600-7688 or email help@vendorco.com.

Understanding Costco Memberships: Gold Star

Costco’s Gold Star membership is designed for consumers on an entry-level basis in terms of pricing and benefits. At around $55.00, this membership is for individuals who do not qualify for, or do not need a business membership. It includes a card for your spouse and gets you into Costco, saving money at any warehouse or online at Costco.com. This membership is suited for customers, who do not expect the return from the 2% “cash back” program.

If you are a supplier who is seeking to bring your product into a Costco warehouse or are interested in beginning the process, VendorCo can help. Call us at 949-600-7688 or email help@vendorco.com.

Reading Price Codes

In all retail establishments, items found on the sales floor will be accompanied by a price sign. Costco signs include the same basic information: a description, an internal identification number, a price, and supportive details about the item. However, Costco signage can often give away secret clues that can add to a shopper’s experience, but may be easily overlooked if you don’t know how to identify them.

Important to note, prices typically ending in “.97″ have been marked down. Other non-standard prices — such as items ending in .49, .79, .89 — are a sign that this is a special deal from the manufacturer. Sometimes there will be an asterisk (*) on the upper right-hand of the price tag, this indicates Costco does not have plans to re-order that product once the stock is sold out, so it’s important to move fast!

It is important to understand how Costco establishes pricing among vendors. If you are interested in submitting your product into Costco, it is vital to calculate all of the costs associated to your product. Contact one of our experts at info@vendorco.com for more details about how our services best serve you.

Inside Costcos Corporate Office

Costco has multiple regional offices with the national headquarters located in Issaquah, Washington. Originally, Costco’s corporate offices were stationed in Kirkland, WA. You may recognize Costco’s Private Label Brand name as Kirkland Signature, a way of paying homage to the origins of this retail powerhouse.

Former CEO, Jim Sinegal, was a native Californian but found Costco’s home in Washington, where Costco is now a household name. In fact, the city of Issaquah recently signed a 30 year agreement with Costco allowing them to expand its headquarters.

To learn more about Costco from our Executive Account Manager, who has experience working in their national headquarters, call us at 949-600-7688 or email help@vendorco.com.

Costco Retainer Fees

One of the main concerns vendors have when starting business with Costco is related to the release of payment. Like any contract, when you partner with Costco you will negotiate payment terms; however, your terms will not necessarily guarantee the release of full payment. Consideration for end of program costs must be taken into account, and Costco will either require or provide the option of holding a retainer for some of these funds.

With Costco’s “Treasure Hunt” atmosphere, items are constantly moving in and out, and exit strategies must be planned appropriately. There are costs to consider with the end of a program, including potential markdowns, discounts, or other adjustments, shipping of returned product on a guaranteed sale, and of course, returns that may continue to come through after the product has been moved off the sales floor. A retainer provides the option for Costco to hold some of the Purchase Order funds to account for these costs. Although it may not seem ideal, retainers benefit and provide assurance to both the vendor and Costco. The vendor would otherwise be required to send a check each and every time the balance falls below zero – that would mean sending a check for each and every return, which could be an accounting and labor nightmare.

A knowledgeable manufacturer representative like VendorCo can help you plan your exit strategies appropriately, including an appropriate and reasonable plan for end of program costs. To set a strong foundation on your product’s prices, contact help@vendorco.com for more details about how our services will best serve you.

Costco Advertising fees

Have you ever noticed that Costco commercials, print Ad’s, and other forms of media advertising are virtually non-existent? This is because Costco chooses to market products only to their members, versus the consumer population as a whole (with the exception of some popular social media sites). Because of this, advertising opportunities within Costco are minimal.

Advertising channels varies depending on where the product is selling within Costco. If a particular product is selling in-store, certain advertising opportunities on Costco.com may not be available, and vice versa. In-store advertising programs at Costco may be different than what you are accustomed to at other retailers. With the exception of roadshow items, Costco does not incorporate flashy materials in the display of their products. Vendors are generally limited to their product packaging, pallet skirts, and occasionally a display unit. However, there are some paid in-store advertising options including coupons, Connection Ads, end caps, front of store placement, and cages.

With limited opportunities available, there is a high demand amongst vendors to obtain one of the coveted spots available. If you are interested in creating a program with advertising, consider partnering with a manufacturer representative like VendorCo. Our team can offer more information and services on in-store advertising options; call us at (866)365-2925.

Training Options

As we mentioned in our previous post, you as the seller have the option to enlist your own employees, or hire a third party company for staffing. It is recommended that your employees do not go into Costco with cold feet and no know-how. This can be easy to ensure when you are using your own staffers – but what about Costco’s third party companies?

Luckily, the designated third-party staffing companies used by Costco for demonstrations do allow you to train and educate their staff. Like any sales team you may encounter, some employees will shine above the rest, but overall, the team members are seasoned and dedicated to sell your product while on the warehouse floor.

Want to learn more about this process? Partnering with a third-party representative like VendorCo will allow you to have advanced knowledge regarding all aspects of Costco sales, including the best way to ensure adequate training of your demo staffers. To partner with VendorCo, contact us today at costcodemos@vendorco.com.

Non-Food Demos

Not all of Costco’s demonstrations are related to food products. In fact, there are several non-food items that can be demonstrated at Costco Warehouses as well. These stations would be set-up in alignment with the appropriate department you are selling to. Non-Food items demonstrations are a different approach than food items. Unlike food items, customers will not always have the “hands-on” approach and instant gratification to sample. Because of this, not all non-foods items would benefit from a demonstration, and those that do should be navigated carefully.

If you have a non-foods product and you are unsure whether a demo would be the best fit for you, then you may benefit from expert Costco representation through VendorCo. We become an extension of your sales team and help you make the best decisions for your company. To get started or for more information, contact us today at costcodemos@vendorco.com.

Costco Advertising: In-store Options

Advertising options to Costco vendors vary depending on the avenue through which a product is selling. If an item is selling in-store, certain Costco.com advertising opportunities would not be available, and vice versa.

If you have ever walked into a Costco Warehouse, you understand that the layout is vastly different from typical retail stores. There are few to no flashy signs, extravagant displays, wall hangings, etc. (with the exception of Road Shows). Instead, all products seem to have a very uniform, clean look. The absence of extravagant features, drawing the members’ eye to specific products, means all products have an equal chance at developing and maintaining successful sales. However, there are opportunities available to increase the visibility of your product in the warehouse, and thus increasing the sales potential.

Opportunities typically include highlighting a product through strategic placement. This may include end caps, front of the store placement, or on Costco’s cages. Of course, there is a cost to these options.

If you are a potential Costco vendor looking for more information about Costco in-store advertising options, contact a VendorCo Account Manager today at (866) 365-3925 or via e-mail at help@vendorco.com.

How can I gain access to Costco’s vendor portal?

Costco’s vendor portal, also known as Costco’s Extranet, is a web based system that provides Costco vendors with access to a plethora of important information. The system is a free and secure accounting tool that allows vendors to track and maintain records of purchases and payments.

And it doesn’t stop there. The vendor portal keeps updated records of important forms and memos as they are released by Costco, as well as additional vendor maintenance and vendor services tools.

However, the extranet is only available to Costco vendors with a valid vendor number. Potential vendors do not have access to Costco’s vendor portal until they receive a vendor number.

If you need help getting your program accepted with Costco, contact us today to see how VendorCo can help at help@vendorco.com or (949) 600-7688