Many Australians are aware that the US behemoth Costco, bulk retailer extraordinaire, opened its first warehouse in Melbourne recently. Costco has received more than a bucket of free promotion through all the media attention it got (and I guess I’m not helping). I’ve been to Costco in the US and wanted to see what the Australian experience would be like. It’s striking how a novelty in one context (me being a tourist in the US) feels so different on my home turf.
In case you don’t know, Costco is a membership-only ($60/year) retailer specialising in large packages or multipacks of edible and non-edible consumer goods, plus occasional items like TVs or iPods or office chairs which are a little harder to sell in lots of ten. An enduring memory of my US visit was a large (two-pound?) bag of pine nuts and enormous trays of meat. The lack of diversity of brands was noticeable (there’s a house brand, and usually at most one or two competing familiar brands stocked for any product). The concept of buying very large quantities of, well, anything, seemed to work well with that USAmerican large-is-better approach to so many things.
But in Melbourne it seemed excessive, inappropriate and depressing. I’m not sure how many consumers can buy a kilo of soft goat’s cheese and eat it all before it goes off. Why do we need 15-inch (approx) ready-to-bake pizzas? They don’t even fit in the average Australian oven. Is it a good idea to only sell wholesale-size boxes of chocolate bars? Or one-thousand-ChupaChup containers? Why in hell do we need imported packages of “American cheese” slices (think fast food burger plastic cheese) or mixed grated cheese? How many people eat a sack of melons before they go off? A kilo of strawberries?
If all that interests you is cheap cheap cheap, then Costco might be for you (though not everything is cheap, some tech is actually uncompetitive). If you don’t mind a large company squeezing brand and product diversity in the Australian market even further (Coles and Woolworths do quite enough of that already), promoting the lowest-common-denominator approach to (in particular) food retailing, then I’m sure you won’t mind the place. But for me much of the experience stank of the same low-diversity, low-quality approach that strikes many foreign consumers who walk into average (not all, but far too many) North American supermarkets.
Whether the annual membership fee will be worth it for you depends on what you can save on (do you have space for 124 nappies or a bazillion rolls of toilet paper?). There will no doubt be specials and occasionally attractive products, especially as they stock tech, kitchenware, stationery, clothes and more. But for anyone who loves fresh food and brand/product diversity, it might be difficult, especially if your household is only one or two people.
What can Costco contribute positively in Australia? Despite importing crap American cheese slices, Costco Melbourne does have an impressive range of cheese (though no quality American cheese, unless I overlooked it). Good roquefort, poor quality gruyère, goat’s cheese, buffalo mozzarella (defrosting on the shelf!), some bries and camembert and some familiar local stuff. Also French butter! The meat looked decent (prices between Vic Market and horrendous Coles/Woolworths) and there was a good range of cuts. Costco might end up being the go-to place for meat amongst those who despair at our existing supermarkets. (But just take a detour to the Queen Victoria Market for goodness sake!)
Perhaps we’ll see a move by the local chains to lift their game and compete more on quality. But many Australian consumers have been successfully brainwashed into prioritising cheap at all cost by those same local chains, so I’m not holding out hope for positive developments.