Costco vs Aldi – Our Rating
Price: Edge Aldi
Aldi has been found to be marginally cheaper than Costco on most items. Here are a few of the most popular examples:
- Mama Cossi’s 16″ Five Cheese Deli Pizza: $4.99 Aldi , Kirkland Signature Cheese Pizza (4 count): $9.99 Costco
- Lunch Mate Never Any! Turkey: $2.99 Aldi, Plainville Farms organic sliced: $8.79 per pound Costco
- Boulder four-flap tall kitchen bags, 13 gallon: $4.99 Aldi; Kirkland Signature Drawstring Kitchen Bag, 13 gallon: $12.79 Costco
- Pur Aqua La Vie Sparkling Flavored Water: $2.99 Aldi; Kirkland Signature Sparkling Flavored Water Variety: $9.49 Costco
- Double Diamond Farms Grape Tomatoes: 79 cents per pint Aldi; Tomatoes, grape, hothouse grown: $5.99 per pint Costco
- Simply Nature Organic Yellow Corn Tortilla Chips: $1.99 Aldi; Kirkland Signature Tortilla Chips, organic: $.99 Costco
What other areas does Aldi have the edge over?
Cost to Shop: Edge Aldi
Costco charges a membership fee of a minimum of $50. Aldi does not require a membership fee.
Accessibility: Edge Costco
While Aldi has more locations, Costco has better store layouts and better national coverage.
Costco has approximately 698 locations. Aldi has more than 1,500 stores in 34 states. However, Aldi does not have coverage in the Pacific Northwest – a major area of the U.S. encompassing the states of the Oregon, Washington and Idaho. In contrast Costco has warehouse locations in most regions of the country. Aldi also has a reputation for offering smaller stores in out of the way locations as a way of reducing costs – making it challenging for customers to get to them. In contrast, Costco has wide opens stores with large banks of registers and spacious isles.
Corporate responsibility: Draw
Both corporations have had a rather clouded corporate responsibility history.
Aldi customers report and Aldi employees say that Aldi employees feel stress due to overwork, often resulting in unpleasant interactions with customers. Not only have Aldi’s corporate labor policies impacted their customer experience, they’ve also gotten the company into legal hot water. In 2010 Aldi was subject to a class action lawsuit by over 200 Aldi managers in 35 states alleging the company illegally violated overtime rules (1).
On a similar vein, Costco management often too aggressively maintains their standards. In 2015 after a somewhat complicated store transaction, an Iraqi Christian immigrant and mother of three was arrested by Virginia police after Costco management staff mistakenly informed police she had committed fraud. The unfortunate woman was later rearrested by Police in Maryland for the same issue, held overnight and strip searched. The case was ultimately dismissed when no Costco representative showed up (1).
In 2010 Costco meat department supervisor Ruben Calvillo over-ordered $10,000 worth of meat. Some of the meat eventually expired and was sold to the public. Costco supervisory staff cornered Calvillo to an office and interrogated him for hours, threatening him with confinement unless he signed a confession. Calvillo was only released after suffering stroke like symptoms. A jury later awarded him $100,000 to compensate him for Costco’s over zealousness (1).
Quality: Edge Costco
There is quite a bit of talk on Reddit surrounding the poor quality of Aldi generic brands versus the very high quality of Costco Kirkland generic brand. Many people believe that Aldi’s generic brand is poor quality and feel this hurts Aldi in the long run. From Reddit:
I would like to see an overall quality comparison. I do shop at Aldi from time to time, but there is a noticeable difference in quality. For instance all the frozen fruit and vegetables I buy from Costco come from certified organic farms. I also once bought some lean chicken breast sandwich meat from Aldi and it had shavings of bone and cartilage in the meat. I can’t handle that, I had to throw it away. It was my last purchase of sandwich meat there. It also made me question the quality of some of the other produce and meats.
Service: Edge Costco
To control costs Aldi sells primarily Aldi brand foods without conventional supermarket services. Aldi has virtually eliminated counter service departments, there is little shelving as groceries are displayed on pallets and moved by forklift, carts must be paid for by deposit and the store lacks baskets. In short, Aldi’s model is based on the elimination of service. As a result consumers tend to respond negatively.
It’s practically all no name brands and they do a bunch of stuff to lower their operating costs to make everything so dirt cheap. They don’t bag your groceries, they only take cash (maybe debit, no credit cards the last time I checked), they don’t really have shelves but instead just aisles created with the containers the food arrived in. Lot’s of odds and ends like that. And as a result, some really cheap food, but like many have commented – the quality dips down a bit.
In contrast, Costco’s model is based on a combination of low prices supplemented by a broad array of services such as dining, eye care, automotive and auto purchasing assistance.
Overall Conclusion: Its a draw
We evaluated Aldi vs. Costco on five metrics: price, cost to shop, accessibility, corporate responsibility and quality. Aldi wins on cost and price to join. Costco wins on accessibility and quality. Both companies have problems with corporate responsibility. In short, its a draw. Neither company consistently outclasses the other.
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