Costco makes major blunder that could save members money todayheadline

Most Costco members would agree that there are a lot of things the company does right.

For one thing, Costco’s prices are downright impressive. Some of its grocery products are priced so competitively that members are willing to take a chance on bulk purchases, even if they end up throwing some of their dairy or produce away.

Don’t miss the move: Subscribe to TheStreet’s free daily newsletter

Costco also holds its products to very high standards. The company keeps a close eye on its inventory and won’t hesitate to pull a product whose quality turns out to be sub-par.

Related: Costco members rush to find new limited product

Costco also has one of the most reasonable return policies in retail.

For the most part, members can bring back any item at any time for a complete refund. And even returns that come with restrictions, like electronics, are more than reasonable.

Laptops, TVs, and other such electronics can be brought back for a refund within 90 days, compared to the 30-day window many other retailers give.

Knowing Costco’s pricing codes saves members money

The prices that Costco puts on its inventory are not random. Rather, there’s a method Costco uses to price and track the items it sells.

Prices that end in a nine are usually the regular store price. So a $14.99 case of granola bars represents the typical price of that item.

Related: Amazon sinks $4 billion to catch up with Walmart

Items that end in a seven, on the other hand, are usually on clearance.

Similarly, items that end with 88 are usually a manager markdown. Products may be discounted this way to move inventory off of shelves, or to indicate that an item has been returned but is still in sellable condition.

Costco pricing blunders give members a chance to save big

Costco takes a very deliberate approach to its pricing so that members can get great value and the company can make money.

But Costco isn’t immune to mistakes. Sometimes, those happen at the individual store level. But when they do, members can benefit big time.

Related: Whole Foods expands with major change customers will love

In the r/costco thread on Reddit, members have taken to sharing stories of mislabeled Costco products.

One member managed to score a five-pound brisket for $1.34 due to a labeling blunder. That inspired more than 700 commenters to chime in and say they’re now going to be on the lookout for similarly mislabeled products.

Another Reddit user pointed out that they managed to score 10 pounds of ground beef for a mere $0.10.

A few Redditors had an interesting theory about these labeling blunders — that Costco was making them on purpose in an attempt to entice members.

“It’s like some kind of unspoken ‘treasure hunt’ game, and each store picks random items to mark down,” one user said.

But a Costco employee who’s part of the thread was quick to bust that myth.

“It happens by accident,” the employee explained.

“We have these numbers for meat, cheese, veggies, etc. for storage purposes, since everything needs to get labeled. Sometimes an employee is printing labels for an item and another comes in and types in these other $1 labels without the employee beforehand noticing.”

More retail:

• Walmart, Target, Costco make major 2025 announcement
• Formerly bankrupt retailer makes painful decision to close more stores
• Top investor takes firm stance on troubled retail brand
• Walmart and Costco making major change affecting all customers

The reality is that it’s highly unlikely that Costco is intentionally mislabeling its products as some sort of game or hidden tactic. A far more plausible explanation is that improperly labeled products come as the result of human error.

But the fact that these incorrect labels can show up on products means members have a prime opportunity to snag even bigger savings at Costco if they look hard enough. And that’s a good reason to pay close attention to labels on individual items.

So the next time you visit Costco, don’t just grab the items you want without looking carefully at the labels. If you dig around, you might find an accidental markdown that saves you a boatload of money. 

Maurie Backman owns shares of Costco.