Letter Re: Substantially Higher Food Prices at Warehouse Stores

Hi Jim,
Yesterday I made my monthly or thereabouts pilgrimage to Costco to buy bulk items for our pantry and other needs. I immediately noticed that prices had gone up on just about everything. The 40 pound bags of Kirkland brand dog food (re-labeled Iams brand) had gone up from $19.90 to $23.64 which is about a 16% increase in price. The 25 pound bags of Indian long grain rice went for $20.00 to $24.00 – a 20% increase and other items here and there had gone up a dollar or two or three.

While Costco continues to be a great value – when compared to other retail outlets – it too is getting hit with rising commodity prices. Mind you I think they do a standard 14% profit on stuff – meaning they negotiate a price then tack on 14% for operating costs and profit, their average markup is about 10% – that should tell you what’s going on.

Anyway, this Fall, if you trawl the Internet at all, is supposed to be a time of great upheaval – different folks have different pet theories about what may occur – mine is economic – this might be a good time to stock up for the winter – it’s harvest time anyway – might be good to remind folks to stock those pantries (while they still can).- Eric