Cost Comparison: Costco vs Coles for Grocery Shopping
In a recent eye-opening comparison, Adelaide resident Ri Springbett delved into the pricing of various grocery items at Costco and Coles, aiming to determine which retailer offers better value for her family. As the popularity of Costco continues to rise in Australia, with now 15 locations nationwide, Springbett’s findings have sparked significant interest among consumers.
Springbett, who has been a Costco member for five years, pays an annual fee of $65. With a household of three, she questioned whether maintaining her membership was beneficial and decided to do a side-by-side price analysis with her regular grocery store, Coles.
“Costco is renowned for bulk discounts, but as a small family, I was unsure if the membership was worth it,” she expressed.
Upon conducting her comparison, Springbett was “shocked” to discover that several items were priced 40% to 50% lower at Costco. Notably, she observed that most products at Costco are store-branded, necessitating a comparison with equivalent items at Coles.
For instance, she found that Australian minced meat cost $10.99 per kilogram at Costco versus $20 per kilogram at Coles, though the comparison was based on Costco’s 3.920 kg bulk purchase compared to Coles’ 500g pack. Similarly, free-range eggs were priced at $0.67 per 100 grams at Costco for a 30-pack, while Coles charged $0.94 for a 12-pack. Other notable price differences included TipTop bread at $3.69 a loaf at Costco against $4.50 at Coles, and a whole roasted chicken at $7.99 versus Coles’ $12.50.
Although Springbett’s analysis was limited to a select range of products, she expressed disbelief at the savings, stating, “From those few items, the savings are significant, particularly on staples like coffee, cheese, and mince.”
A recent CHOICE report corroborated her findings. It revealed that in a spot check of 23 bulk items against similar prices at Coles and Woolworths, Costco had the least expensive unit price in 19 instances.
As grocery prices soar—Finder has reported average household spending reaching a record $233 weekly, a 27% increase from 2022—many Australians are adopting more strategic shopping habits, with a growing number of consumers visiting multiple stores to seek the best deals.
Rebecca Pike, a finance expert from Finder, remarked that Costco’s appeal lies in its competitive unit prices for larger quantities. “For larger households or those able to stock non-perishables, Costco can provide substantial savings,” she advised, while emphasising that it’s essential for consumers to verify unit prices at their local supermarkets for an accurate comparison.
Nonetheless, bulk buying might not suit everyone, particularly smaller households, those with limited storage, or individuals lacking the cash flow to purchase in bulk. Pike cautioned that membership fees should ideally be recouped through savings, emphasising that a careful evaluation of shopping habits is necessary: “If you don’t shop regularly, it might not be worthwhile.”
For Springbett, the cumulative savings on grocery items and fuel for her vehicle at Costco fuel stations made the membership a savvy investment. “It has altered my perception of Costco; I now see the value more clearly and will include more bulk purchases when shopping,” she shared.
She typically does her weekly shop at Coles, spending between $100 and $120, while her Costco visits occur every few months, where she spends around $200 per outing. Her strategic shopping approach is focused on purchasing school snacks, fruit and vegetables (which can be frozen), and freezable bread loaves.
However, she recognises the appeal of Costco’s vast offerings as both a potential distraction and temptation when shopping. “The excitement can easily lead to spending more than intended, so maintaining focus during my shop is crucial,” she warned.
In summary, while Costco presents substantial savings in certain categories, particularly for larger families or those willing to buy in bulk, it’s essential for each consumer to assess their individual circumstances, including consumption habits and storage capacity, before committing to a membership.
