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As most penny-pinching consumers know, joining a warehouse club can result in great deals on everything from 46-inch flat-screen TVs to 12-packs of chicken-noodle soup. But that doesn't mean every product in the rustic aisles of BJ's, Sam's Club or Costco is a steal.
"You could make the argument that everything in the building is a good deal," says Michael Clayman, the editor of Warehouse Club Focus, a trade publication. Clubs make most of their profits from annual membership fees, which range from $40 to $100. That's one of the reasons why warehouse club markups are just 8% to 13% above wholesale prices, while mainstream retailers charge 25% to 50% more, he says.
But, as Clayman explains, those great prices don't always mean you're getting the best deal. Here are five of the best warehouse club buys and five to steer clear of:
Best buys
Alcohol. Wine, liquor and beer prices can be 35% lower than at supermarkets. The best deals, however, are on high-end bottles."Warehouse clubs sell more Bordeaux than fine-wine shops," says Natalie MacLean, the editor of NatDecants.com, a wine education site. Costco recently offered a magnum of Chateau d'Yquem Sauternes 1997 for $500 -- $300 cheaper than the price on WineAccess.com. Bonus: Some states' laws let you buy alcohol without having to pay for a warehouse club membership.
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Milk, butter and eggs. In all but a few cases, you can beat warehouse club food prices at supermarkets by combining weekly store sales with manufacturers' coupons. The notable exceptions: milk, butter and eggs, which are at least 20% cheaper at warehouse clubs, says Teri Gault, the founder of The Grocery Game, a shopping Web site. At Sam's Club, for example, a four-box pack of salted butter quarters recently was priced at $8.67. At ShopRite, it was $13.96.
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Electronics. More often than not, gadget shoppers will find a better deal at a warehouse club than at mainstream retailers. For instance, BJ's recently beat Amazon.com by $6 on the Olympus FE-340 digital camera. But the real draw is the clubs' generous return policies, which encompass everything from price drops to out-of-warranty glitches, says Jerry Grossman, the editorial director for tech education site DemystifyingDigital.com. Costco accepts electronics returns within 90 days of the purchase, three times longer than Best Buy's policy. Sam's Club permits returns of most computers within six months, with no deadline for other electronics.
Meat. When it comes to the meat at the warehouse club, think: Top-notch butcher-shop quality meets supermarket prices. "It's a home run every time," enthuses Phil Lempert, the founder of Supermarket Guru, a news site. Two fresh racks of lamb (no antibiotics, no hormones) were selling recently for $95 at Costco. The same quality and quantity of meat was $120 and $135 at iGourmet.com and Lobel's of New York, respectively.
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Prescription medications. Warehouse clubs routinely charge 50% less than local pharmacy chains and may even beat the $4-a-month offerings at superstores such as Wal-Mart and Target, says Gabriel Levitt, the vice president of research for pharmacy-rating site PharmacyChecker.com.
Recently, you could buy 100 pills of generic blood-pressure medication Lisinopril (20 milligrams) and pay $9.53 at Costco or $10 at Sam's Club -- much less than Drugstore.com's $35.54. Better yet, most clubs even allow nonmembers to fill prescriptions at the pharmacy in person or online.
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