Warehouse store showdown: Should you join Costco, Sam's Club, or BJ's?(Read article summary)
Membership in warehouse stores can save consumers big. But among the big three – BJ's, Sam's Club, and Costco – which one is right for you?
According to Consumer Reports, shoppers can save up to 55 percent at warehouse clubs – on everything from bulk packages of toilet paper and frozen pizza to Coach handbags and vacation packages. If you belong to one, you’re probably enjoying the savings and the “treasure hunt” shopping experience – never quite knowing what you’ll find on shelves and pallets.
It’s no surprise that as warehouse clubs open more locations and offer a wider range of items, sales are growing. The $390 billion industry has seen a 137 percent jump in sales from 2001 to 2011, compared to 47 percent for all general merchandise stores, according to First Research.
But which warehouse club is best for you? Sometimes it’s as simple as finding the one closest to home, but if you have choices, you should consider factors, from selection to return policies. We put the big three to the test by comparing 11 factors – from basic membership costs and locations to selection of luxury goods.
1. Membership costs
Basic membership is $50 a year at BJ’s, $55 at Costco, and $40 at Sam’s Club. If you want to test the waters first, keep an eye out for free trials.
Warehouse clubs offer rewards programs, but they’re not free. Become a BJ’s Rewards member for $100 a year (or upgrade an existing membership for $50), and you’ll get 2 percent back on most in-club and BJs.com purchases. Costco’s Executive Membership is $110 a year and also offers 2 percent rewards – capped at $750 a year. Sam’s Club is experimenting with the idea of a cash rewards program; in a new rollout, Plus members ($100 a year) are now receiving $10 for every $500 spent – which also comes out to 2 percent – capped at $500.
3. Nonmember surcharges
Thinking about shopping at a warehouse club without footing the bill for a membership? Costco is the least expensive: the surcharge to nonmembers is 5 percent. BJ’s is the highest at 15 percent, while Sam’s Club’s surcharge is 10 percent.
5. Shopping experience
In a Consumer Reports survey, 26,000 shoppers evaluated their experiences at 10 major retailers: Costco, JC Penney, Kmart, Kohl’s, Macy’s, Meijer, Sam’s Club, Sears, Target, and Walmart. Costco was the top-rated store in the survey. Sam’s Club got average or slightly above average grades in all categories. BJ’s wasn’t included.
In another survey by Temkin, 6,000 consumers ranked companies based on customer service. Costco ranked third, behind Amazon and Kohl’s, with 79 percent of survey respondents giving it an “excellent” or “good” rating. Sam’s Club and BJ’s were close, however, at 78 percent.
While this doesn’t point to a clear winner, it’s safe to say the overall shopping experience at any of the big three doesn’t differ much – and doesn’t disappoint.
6. Return policies
From Costco’s return policies page: “We guarantee your satisfaction on every product we sell with a full refund. The following must be returned within 90 days of purchase for a refund: televisions, projectors, computers, cameras, camcorders, touch screen tablets, MP3 players and cellular phones.”
From Sam’s Club return policies page: “We offer a 100% guarantee on merchandise and Membership. We will refund purchases in full with a receipt. Click here to view our Return/Refund exceptions. No receipt: We will refund the purchase(s) at the last selling price with a shopping card.”
From BJ’s return policies page: “Items eligible for return must be returned within 30 days from date of shipping. For more information, please see the “Proper Conditions for Return and Credit” section of BJ’s Return Policy.”
So Costco and Sam’s Club have similar return policies, while BJ’s policy is far less liberal.
7. Coupons and sales
BJ’s is the only warehouse club that accepts manufacturer’s coupons. BJ’s also has 24-hour flash sales online, promoting deals on items like HDTVs and digital cameras – often with free shipping.
At Sam’s Club, discounts can get even deeper with online auctions. Online members can bid, with all bids starting at $1.
Renee Morad is a writer for Money Talks News, a consumer/personal finance TV news feature that airs in about 80 cities as well as around the Web. This column first appeared in Money Talks News.