alt Hacker NewsAlso the reason that small specialty shops, and mom-and-pop grocery, fruit, dairy, bakeries and butcher shops are largely gone. They just cannot compete with Costco and Sam's Club/Walmart's buying power.
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Actual specialty shops survive just fine. There's plenty of value in real expertise. Run-of-the-mill stores selling the same commodity at a higher price are simply inefficient.
The idealized small mom-and-pop shops were largely put out of business by WWII and rationing more than anything. Supermarkets and department stores have more or less been the norm in the US since long before Wal-Mart began spreading across the country.
There are still plenty of produce stands, bakeries, and butcher shops in the country. Most of what was driven out of business were small bodega-style corner stores.
I will not buy coffee at Costco. I've had Costco coffee beans and it's terrible. I only buy premium beans at specialty shops and always will. The masses can drink their subpar coffee from Costco if they wish.
I remember reading costco has leverage on their supplier-producers, enough that they than enforce better standards above regulation (i.e. meats/produce), which is something mom-pop can't do.
99% of the reason for the mom-and-pop groceries dying out is that "our" Federal Gov't decided that it would stop bothering to enforce the law - https://en.wikipedia.org/wiki/Robinson%E2%80%93Patman_Act
And note how the modern Democratic Party - the originators of that law back in 1936 - utterly failed to give a crap about the issue.
A specialty shop can probably survive Costco much more easily than they can survive Walmart or any other conventional (American) grocery store. The grocery store carries 20 or 30 different olive oils, to select one example. Odds are all the snobbiest will find something they like... odds are even decent that in a blind taste test even the snobbiest would find something that they would be horrified to discover came from a normal grocery store.
Costco carries one or two options for a given thing, and are outright missing many things you might want. As nice as Costco is for buying things on a budget when you're going to use them up fully, I think it would be a bit of a challenge to make them your only grocery source. Doable as a sort of self-imposed challenge, no problem, there's certainly enough for that, but you'd be missing a lot of things, and/or wasting money on huge quantities of things you won't use. The quality is generally pretty decent (I may have more brand loyalty for "Kirkland" than almost any other brand) but not necessarily the most premium options. If you are the type to even consider the specialty shop in the first place you're more likely to be unsatisfied by Costco than a grocery store.