Costco is the anti-Amazon(phenomenalworld.org)
565 points by bookofjoe 49 days ago | 571 comments
tl;dr: Costco's success—10%+ annual revenue growth, 90% membership renewal, 6% employee turnover—comes from doing the opposite of Amazon: limited SKUs (4,000 vs. Walmart's 130,000), no fancy automation, pallet-based cross-docking, and customers handling last-mile delivery themselves. This simplicity yields lower overhead (10% of sales vs. Amazon's 40% delivery costs), better supplier relationships, and higher wages. The author argues Costco offers a more socially efficient blueprint for goods distribution than Amazon's logistically complex model, and suggests NYC's proposed public grocery stores under Mamdani should adopt Costco's low-SKU, high-volume approach rather than aiming for one store per borough.
HN Discussion:
  • Costco's pallet/warehouse model is more socially efficient than home delivery logistics
  • Costco's model only works for car-centric suburbs, not dense cities like NYC
  • ~The article overlooks that Costco itself uses delivery services like Instacart
  • Amazon already applies choice-reduction principles and can support long-tail SKUs simultaneously
  • Costco and Amazon serve largely different product categories, making the comparison weak