Samsung is showing ads on some refrigerators that cost over $3,000. The South Korean company has confirmed that these advertisements will be shown as a test run on some "Family Hub" refrigerators that are sold in the US. Users cannot disable them.
Costco only takes a 10 or 15% markup though. Assuming they’re doing the usual of doubling their costs, hopefully that would be under the cost of their competitors. Even if it was equal or slightly more expensive, I would support them.
It’s not the retailer side that’s the problem, it’s the manufacturing side. CostCo is almost certainly not going to get into the appliance market. It’s a difficult market that’s not very similar to other electronics or other home improvement segments. Not to mention that CostCo’s economies of scale with appliance manufacturing would be terrible. They would be limiting their hypothetical appliance manufacturing business to one retailer in one country (albeit a very large one). Not to mention current tariff risks. A “basic” class appliance SKU would be more sensitive to the relatively higher costs for manufacturing in the US. Appliances are manufactured in the US, but the economics would be more negative on a relative basis for a “basic” class appliance brand owned by a retailer.
I am not very knowledgeable about CostCo’s in-depth per-segment strategy, but I suspect appliances in particular are more sensitive to margin issues even on the retailer side. Appliances are big, bulky and difficult to deal with (on a relative basis).
Don’t get me wrong, I would welcome more competition, but what you’re proposing is likely not possible. You would probably need regulation considering the nature of the appliance market.
They’re already in the appliance market, they sell them. If you mean as a private label, they just put their name on other company’s products. I think they call it no-label or something like that.
I see, I didn’t know that they had a private label appliance product line (don’t remember seeing their brand in their sales data, but I probably missed it).
And they are significantly cheaper than comparable SKUs from branded products (especially the entry level brands, Frigidaire I believe is one)?
It wouldn’t be the first time something like that was done either, especially in the appliance world. I occasionally get a call for an IKEA or Kirkland Signature Appliance… They’re always just rebadged units from a major manufacturer, often Whirlpool in the cases I’ve encountered.
Costco only takes a 10 or 15% markup though. Assuming they’re doing the usual of doubling their costs, hopefully that would be under the cost of their competitors. Even if it was equal or slightly more expensive, I would support them.
It’s not the retailer side that’s the problem, it’s the manufacturing side. CostCo is almost certainly not going to get into the appliance market. It’s a difficult market that’s not very similar to other electronics or other home improvement segments. Not to mention that CostCo’s economies of scale with appliance manufacturing would be terrible. They would be limiting their hypothetical appliance manufacturing business to one retailer in one country (albeit a very large one). Not to mention current tariff risks. A “basic” class appliance SKU would be more sensitive to the relatively higher costs for manufacturing in the US. Appliances are manufactured in the US, but the economics would be more negative on a relative basis for a “basic” class appliance brand owned by a retailer.
I am not very knowledgeable about CostCo’s in-depth per-segment strategy, but I suspect appliances in particular are more sensitive to margin issues even on the retailer side. Appliances are big, bulky and difficult to deal with (on a relative basis).
Don’t get me wrong, I would welcome more competition, but what you’re proposing is likely not possible. You would probably need regulation considering the nature of the appliance market.
They’re already in the appliance market, they sell them. If you mean as a private label, they just put their name on other company’s products. I think they call it no-label or something like that.
I see, I didn’t know that they had a private label appliance product line (don’t remember seeing their brand in their sales data, but I probably missed it).
And they are significantly cheaper than comparable SKUs from branded products (especially the entry level brands, Frigidaire I believe is one)?
It wouldn’t be the first time something like that was done either, especially in the appliance world. I occasionally get a call for an IKEA or Kirkland Signature Appliance… They’re always just rebadged units from a major manufacturer, often Whirlpool in the cases I’ve encountered.