When Filling Up At Costco Doesn’t Make Sense

There are many people I know that swear by Costco for the cheapest gas prices.

I wish there was a way to make it work for us, but typically we don’t get too much gas from Costco.

mb-201103gaspumpIf anybody has any suggestions on how we could make it work (or whether we’re taking the right approach), I’d love to hear your feedback.  Here are the main reasons that Costco gas doesn’t really work for us:

  • Location – There isn’t a Costco that’s very convenient to us.  In fact, if you go to Costco’s website and choose a store locator, we’re almost smack dab in the middle of four stores.  This gives us a nice selection of stores to choose from but that also means they’re all about eight miles away.
  • Location (part 2) – None of the stores is near where we typically go.  My wife doesn’t work, and 75% of the shopping trips she makes are within a couple miles of the house.  I work three miles from home, so there’s not one that’s convenient for me to ‘stop on the way’
  • Timing – We typically go to Costco once per month.  We usually time our visits to match the coupons that we get in the mail, which rotate once per month or so.  Often times, we will have enough gas in the car to where filling up isn’t necessary.
  • Payback effect – My wife’s car is the one that would typically be a candidate to get gas at Costco.  She drives an SUV that gets around 18 miles per gallon.  Unless we’re driving past one or making a planned shopping trip, the ‘cost’ of getting gas would be about one gallon.  With a twenty gallon fill-up, that means that (at current rates), we’d have to save about 17 cents per gallon to break even.
  • Value of time – I’ve heard, especially recently, that this type of difference between nearby stations and Costco stations does often exist, with some family and friends reporting up to a 25 or 30 cent difference in pricing.  But, on top of the cost savings, you have to factor in whether the 30-45 minute trip would be worth the additional savings.  Maybe, but I’d rather spend the quality time with my family than spend that time in the car or away from my family.
  • Chance -Even if Costco gas is cheaper, there’s no guarantee that it would be as cheap, even if you hopped in the car and drove to the station as soon as you heard of the variation in price.  Just like anybody else, Costco can raise prices anytime, so you’d have to ask whether that 25 cents per gallon difference will still be there.

Bottom line, if we had a Costco right down the street or if we drove past one on a regular basis, I’d be inclined to make more of our gas purchases there.  As it is, it’s pretty rare.  I think the one thing I will do is look to see if we can plan our fill-ups to coincide with our monthly shopping trips.  Outside of that, I don’t see a way that really makes sense for us to utilize Costco’s gas stations.

Any ideas?

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17 thoughts on “When Filling Up At Costco Doesn’t Make Sense

  1. Not really. I guess if you head in the direction of Costco for an errand then stop by.

    I have a Costco right near work so I can drop by pretty easily.

  2. If it doesn't make sense, then it doesn't make sense. Trying to FORCE a fit is not sensible.

    I save money at Costco because I drive right by the one near my office every single morning. I can check the prices as I drive by and 90% of the time it's cheaper than any other gas station along my route (and i pass a lot of gas stations). So I stop either on the way to work or on the way from work and fill up.

    But I don't see why you'd want to force the issue if it's not convenient and cheaper for you.

  3. That kind of price difference doesn't exist at my Costco. It's more like a few cents. Therefore, I only use Costco for gas if I'm already there shopping and need to fill up. I can't think of anything you're missing in your analysis.

  4. Fortunately, the market here is saturated with Costco outlets. There are two on my way home from campus and one near my son's house.

    Given that situation, the trick is to figure out which one offers gas at the lowest price. They set their prices each morning by sending an employee out to scout the prices at several nearby gas stations, underpricing them by anything from a few pennies to upwards of a 15 cents a gallon.

    I've found that the outlets in the poorer parts of town, such as the Ghetto Costco near my son's house, tend to have the lowest prices. In more upscale areas, some neighborhood gas stations may undeprice the local Costco.

  5. Costco clearly does not represent the best value for the consumers that it once did 7-10 years ago. I find cheaper gas prices @ my local Fred Meyers and computing equipment and pricing are better @ Best Buy. I am Costco Executive Member considering not renewing my membership as the Costco Value Proposition for the consumer is just not there any longer.

  6. Last time we were in south Florida, we passed by a Costco to get gas. It was priced only 5 cents less than competitors across the highway (Route 1). The lines were very long, and a wait for the pump was probably about 20 minutes. For a 15-gallon fillup, it was not worth the $0.75 savings to wait on a long line. We filled up across the street. The differential would have to be way more than 5 cents for us to savings wait-worthy.

  7. If you looking for the cheapest gas in your area then download an app to your smart phone called GasBuddy. It shows you up to date prices in your area so you can find the cheapest gas without all the driving around.

  8. If you use the Costco Amex credit card factor in cash back of 3%, this adds up to more savings.

  9. Costco gas is usually around 3-5 cents cheaper in my area, & is on my way to/from work. However, where I truly benefit, is when gas prices rise. I can usually go the next morning on my way to work, & get it @ less than the previous days price. That in itself has paid off numerous times.

  10. The best time to go to Costco to fill up is when gas prices jump suddenly. The neighborhood gas stations tend to raise prices instantly using heard mentality when oil barrel price rumours start, even though the price of the gas already in their tanks was paid for at a lower amount. Costco doesn't do this. One day for example only about a month ago all the local stations raised their price from $3.05 to $3.35, and Costco left their price at $2.99 for 2 more days!

  11. There is a costco right down the street from us. It's about 5 cents cheaper than anywhere else, so I get it there when it's easy but I don't stress over it. The gas station part stays open an hour after the store closes, so if you can get in during that window there isn't usually a wait.

  12. I find that when prices are dropping, costco seems to be more expensive than other stations. Perhaps Costco's prices are somewhat lagging.

  13. I pass costco everday on my drive to work so I fill up in the mornings about once or twice a week when it's not busy which is convenient and the gas is cheaper. But I do skip getting gas from them during the day because it can be a very long wait. It's saving me money because I'm not going out of my way and having the executive mbrship pays for itself because I shop there alot to earn cash back.

  14. Hi

    My problem with COSTCO gas is that it's not Top Tier. I had to spend more than $700 in repairs to one of my cars after using COSTCO gas for a year. My other car, an older one, is fine with COSTCO gas. When you buy a car, find out what is recommended or if anyone has has any problems before you chase the lowest prices.

  15. The Costco where I shop once a month (to coincide with their coupon booklet's period of validity) sells gasoline for only three to five cents per gallon less than the local market. The Costco gas is ten percent Ethanol which results in less total energy content per gallon and therefore delivers poorer mileage per gallon than non-Ethanol gas. That, plus the long waiting lines at the Costco pumps make their product a poor choice for me.

  16. We stick to fuel that qualifies as "top tier" fuel only. It has been a major contributor to the long life (375000 miles)of our car. Costco doesn't qualify.

  17. I'm the guy who has been picketing the Costco gas pumps in San Luis Obispo, California, for 4 months. I started because I drove across town one morning, filled up at Costco, went back home and noticed the station down the street had the same price. I confronted Costco about this and their response was, in essence, too bad. So, I've been informing the public that Costco's price is the same as stations downtown and, when you factor in the cost of driving there, plus the time, plus the Costco card, you're LOSING money buying gas at Costco.

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