If you’ve’ bought your gas at Costco, you’ve had a hand in fueling profits at the popular warehouse club.
Costco Wholesale Corp. said quarterly profits rose better than Wall Street analysts expected as the high price of gas elsewhere drove members to its pumps and inside its stores.
A glance at average gas prices in metro Atlanta at midday Wednesday showed Costco and Wal-Mart’s Sam’s Club had the lowest price for regular at 3.55 a gallon. The average price of gas was $3.679 in metro Atlanta, $3.685 in Georgia and $3.685 nationally, according to Atlantagasprices.com.
Low-balling its fuel prices cuts into Costco’s profit margin, but as Reuters points out, it’s part of a larger strategy. Costco is banking on luring customers with its cheap gas in hopes they’ll park and go inside its warehouses and stock up.
As Reuters further notes:
Selling gasoline drives revenue, but gas is less profitable than other goods. Costco has said in the past that about 30 percent of its members buy gas and shop on the same day.
Gasoline sales also have helped sales at Wal-Mart‘s Sam’s Club.
Do you find yourself getting a better break on gas prices at wholesale clubs?