Why The Best Deals At Costco Are In The Middle Of The Store

It has long been known that one of the best ways to save money in discount stores like Costco and Walmart is to plunge towards the middle of the store. Such advice often appears in the form of a tip given by publications like Lifehacker with the obvious implication that you should go straight to the savings. However, treating these "central courts," as Paco Underhill calls them in the article, as a savings hack only works if we ignore the surrounding store. The main placement of the huge discounts is not so much in the middle of the store but between typically expensive goods on sale and essentials.

Stan Laegreid emphasizes the importance of Costco's in a 2014 piece for Fast Company. Upon entering the establishment, the customer is greeted with the "luxe" offerings of televisions, computers, or Prada handbags on sale. The fresh food is found at the opposite end of the store causing the buyer to either go directly through the discount offerings in the center or loop round the "very outside of the track [which] is home to practical staples, including toilet paper, whose location requires consumers to pass many impulse buys." These impulse buys include the "center court" that is generally cheaper than whatever you are ringing round to get.

The entire layout is to stop customers from displaying what National Geographic refers to as the Boomerang Effect, in which a customer simply head to what they need and leave.

The same reason for the great deals in Costco's "center court" inform its famously low-priced rotisserie chickens and hotdogs, which it sells for $4.99 and $1.50 respectively. In fact, the reason is so important that, as CNN reported in 2019, Costco decided to build an entire chicken farm operation just to keep the price pegged at $4.99. Similarly, as The Takeout notes, the $1.50 hotdog has stayed at that price since 1985. The Takeout, unlike Mental Floss, fails to mention that when Costco's president complained about how much money it was were losing over the deal to CEO Jim Sinegal, the CEO said "If you raise [the price of] the effing hot dog, I will kill you." Wow.

Costco takes its deals so seriously because they serve as the stores' loss leaders. Culinary Lore explains that loss leaders are low-priced goods that attract traffic to the store. Ideally for the store, people will then stroll around and stumble upon things they didn't necessarily need but will buy on impulse. Like the center court, then, there are specific goods in Costco that could be gamed into a very cheap trip. However, their low prices are enabled by the goods surrounding them, which may convince you to buy them either because they're essentials or provide savings that may leave enough money for a splurge. Scope out the deals Costco displays, but keep your eyes open to the costs waiting around you.