Do Not Sell To Costco

I love Costco, in spite of the fact I run a tremendous trade deficit with that company. I buy a lot from Costco, but they buy nothing from me. We are both happy with the situation. (This is why the fact we run a trade deficit with China or Japan does not matter, any more than mine with Costco matters).

I sell nothing to Costco because we at the small business level have no business selling to Costco. Costco is fairly unique inasmuch as they will take product from small businesses and offer it for sale. The few instances that I know of personally, this usually ends up a disaster for the small business. To match the costco demand the small business will borrow and ramp up production. Eventually Costco moves on and the small business folds due to inability to service the debt for the ramp-up.

I sampled an excellent high end product this evening at Costco. The product was selling well. I doubt these people will be in business in a year. Too bad, since they might have grown by selling on frequency and not volume. Don't sell to Costco.

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