Major retailers typically have several in-house brands. Costco just has one: Kirkland Signature.
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Costco sells a lot of brand-name goods at a lower unit price than typical retailers charge.
But the warehouse chain's Kirkland Signature brand is where the cost savings can really add up.
We compared shopping carts filled exclusively with Kirkland products against national brands to find out.
When it comes to cutting costs on everyday items, buying in bulk and buying store brands are both big ways to save.
Buying store brands in bulk? That's like a cheat code to maximizing savings.
I recently found in a price analysis that shopping at Costco was generally cheaper on a unit-cost basis than buying the same products from a traditional retailer. Depending on the item and how often it's purchased, the savings could even offset the $65 annual membership fee.
Many Costco members find the chain's own Kirkland Signature brand is the real ticket to getting the most bang for their buck, though. So I decided to look at how cost-effective it is to buy Kirkland compared to the comparable name-brand products Costco carries.
Kirkland Signature is big business for Costco. The banner — which includes gasoline, meat, some liquor products, and a range of other categories — accounted for roughly a third of Costco's $267 billion in worldwide sales last year.
To find out how much of a difference the choice between national brands and Kirkland Signature can make, I visited a local warehouse and compared prices.
I focused on in-store products that were near matches between Kirkland Signature and a national brand in terms of functionality, key ingredients, and other relevant features.
Although the Kirkland Signature brand offers dozens of products, not every product has a like-for-like alternative. Sometimes it's because Costco only carries a Kirkland Signature offering (like milk), and sometimes the national brand is the only choice (like Cheerios).
I narrowed my list to 17 representative items and calculated the cost of an exclusively Kirkland Signature shopping cart compared with an exclusively national-brand cart. I also did the math to determine the price difference if the Kirkland Signature items were sold in matching pack sizes to the national brand versions.
In most cases, the shelf price of Kirkland Signature products was lower than the branded option, but the real difference emerged when adjusting for the actual number of units per pack.
The branded shopping cart clocked in at $297, while the Kirkland cart was $72 less at $215 before discounts or taxes. (Many shelf labels at Costco have discounts baked in.) After adjusting for pack sizes, the Kirkland cart would come in around $186, for an effective savings of $111 or about 37%.
The pharmacy section — acetaminophen, allergy pills, cold medicine, and fiber supplement — accounted for some of the biggest dollar savings in my cart comparisons.
On a unit-price basis, the savings ranged from 0% (apple sauce pouches) to 89% (allergy medication). In most cases, the unit prices for Kirkland Signature products were 10% to 50% lower than those of their national-brand counterparts.
I've been covering retail for years now. I've always been watchful about prices, and I'm mildly obsessed with store brands, but these numbers surprised me. This analysis shows how big a wallet impact can come from a few very simple choices in the shopping aisles.
Read on to see the breakdown of the 17 items I compared prices for, in order of savings per unit before discounts.
Allergy medication
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Kirkland Signature has several allergy medications, all of which cost a fraction of their name-brand counterparts. This Zyrtec alternative costs about 89% less per tablet than its name-brand competitor. The Kirkland Signature pack size is also larger and less expensive than the national brand.
Cold and flu medication
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Kirkland Signature's alternative to NyQuil is similarly cheaper, at around 83% less per caplet. It also comes in a larger pack and at a lower shelf price than the name-brand product.
Tortilla chips
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I did not expect tortilla chips to offer this much savings. But the Kirkland Signature bag is twice as heavy, meaning the per-ounce price is 62% less for Kirkland Signature than Tostitos.
Pain medication
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Back to the pharmacy section, where Kirkland Signature truly shines. Kirkland Signature's acetaminophen costs about half as much per gel cap as Tylenol. With the discount Costco offers on Tylenol, the Kirkland version is still about 40% less.
Bottled water
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In the far back corner of the warehouse, near the loading docks, there are 40-packs of 16.9-ounce bottled water. The Ice Mountain brand costs $7, the Kirkland Signature costs $4, for a relative savings of 43%.
Fiber supplement
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Fiber supplements seem to be all the rage these days, thanks to GLP-1 weight-loss drugs. Kirkland Signature's offering, which it says is comparable to Beneful, costs roughly one-third less per serving.
Batteries
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One Duracell AA costs $0.53 at Costco, while a Kirkland Signature battery costs $0.35, or about a third less.
Cheddar cheese
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This Tillamook cheddar cheese costs $4 per pound, while the Kirkland Signature cheese costs $1.20 less.
Snack bars
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Kirkland Signature's nutty snack bars have ingredients and serving sizes similar to those of Kind bars. The shelf prices are both about $17 per pack, but the Kirkland Signature version includes eight more bars than Kind, which works out to about 27% in relative savings.
Facial tissue
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These 12-packs of Kirkland Signature facial tissue cost $5.50 more than Kleenex, which works out to a 25% savings.
Plastic storage bags
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Kirkland Signature freezer bags are similarly cheaper per unit, about 25% less for Costco's version than for Ziploc. Like the snack bars, the pre-discount shelf prices are nearly the same, but the Kirkland Signature pack has more bags in the box.
Sugar
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Sugar is an example of where an obsession with unit prices can go off the rails. The Kirkland Signature organic cane sugar sells for a tidy $1.20 per pound, but you have to buy the whole 10-pound bag. That might be too much sugar for some folks — it could be better to recoup the $1.70 effective savings elsewhere.
Whole bean coffee
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Coffee beans are a lot like gasoline: a small change in the unit price can mean big savings for heavy consumers. In this example, the Colombian beans from Kirkland Signature are about 13% less than the Starbucks Pike Place roast. That's like getting eight bags for the price of seven.
Organic chicken nuggets
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Chicken nuggets are another interesting example, since Costco tends to lean more toward organic options in its food offerings, which can be more expensive than the non-organic options at the warehouse. That said, Kirkland Signature frozen organic chicken nuggets are about 11% cheaper than a similar product from Just Bare.
Laundry detergent
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Kirkland Signature has multiple laundry detergent options. One marketed as "free and clear" bears a striking resemblance to a similar offering from All, sold at almost the same unit price. Without actually using the product, the only observable difference is the slightly smaller pack size and lower shelf price for the Kirkland Signature version.
Apple sauce pouches
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While the price per pouch is the same for both the Kirkland Signature and GoGo Squeeze options available at Costco, the Kirkland version is organic. Which is the better value is up to shoppers to decide.
Dish soap
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It took scouring an entire warehouse, but I found a functionally matching product whose national brand unit price was lower than Kirkland Signature's.
This 102-ounce jug of Palmolive dish soap costs $0.088 per ounce, narrowly beating out Kirkland Signature's $0.089 per ounce. That works out to a functional savings of $0.074 in favor of the national brand.