Why Costco and Trader Joe’s stopped selling your favorite products

New York ( Business) — Chances are you’ve been there: You go to Trader Joe’s for caramel popcorn, churro bites, and toasted gorgonzola cookies, or to Costco for their mini Kirkland Signature Peanut Butter Cups and pizza to go.

But when you get to the store, your favorite products are not on the shelf. And, to your horror, you learn that they are not coming back.

They were discontinued.

It is one of the most disappointing experiences as a buyer. The reason why a beloved product has disappeared is one of the most common questions customers ask stores. Fans have social media accounts dedicated to track discontinued products at Trader Joe’s, and others blog about items they haven’t seen at Costco in a while.

“We understand that it can be disappointing, even devastating,” says Trader Joe’s in its contact page with customers about discontinued products.

There are several reasons why Trader Joe’s, Costco and other stores suddenly stop selling customers’ favorite products.

Sometimes products are seasonal, or a manufacturer always planned to make them for a limited time. Also, in the case of stores like Costco and Trader Joe’s, banning items can reinforce the appeal of these stores, which can have a certain charm as “treasure hunt” locations.

But more often than not, there are other strategies behind it.

One big factor: It’s hard to get and stay on the shelves at Trader Joe’s and Costco. These companies sell a limited number of items, only the products most in demand by customers.

That’s quite a different strategy than supermarkets, as well as companies like Walmart and Amazon, which offer a wide range of foods and brands. Costco, for example, sells around 4,000 different products at any given time. Traditional supermarkets usually sell 40,000.

Both companies’ ability to keep prices below most of their competitors depends on turning over large volumes of best-selling merchandise every minute, every day.

If an item isn’t selling fast enough on the shelves at Trader Joe’s or is gathering dust in Costco’s warehouses, companies have to switch to something else that customers do buy.

“If you don’t have high or growing volume, the production and handling costs of a slow-selling product are so high that it doesn’t make business sense,” Trader Joe’s vice president of marketing Matt Sloan said. , in a podcast of the company earlier this year.

Other times, it’s the product itself: companies pull items if suppliers raise the price too high or the quality drops.

“Costco would rather not sell an item than sell it for too high a price,” says Chuck Howard, associate professor of marketing at Texas A&M’s Mays School of Business. “It would be uncharacteristic of the brand to sell things that consumers consider too expensive.”

For example, about five years ago Costco substituted a $27 boneless, skinless frozen chicken breast from Perdue for a $21.99 version from Wayne Farms, said Marcus Walker, assistant food buyer. frozen at Costco from 2005 to 2020.

Items that are cheaper at other stores are also among the first to come out of department stores.

Costco wants its products to be the cheapest option. It pulled Hot Pockets because it couldn’t match Sam’s Club prices on the product, Walker said.

Costco’s teams purchase their suppliers’ products from competitor stores and test them for quality against Costco’s. If they find a product tastes better elsewhere, they’ll ask the supplier to make it better for Costco, Walker said, and if that doesn’t happen, Costco will look to replace it.

Another problem, highlighted by the pandemic, is the stability of product supply. If a manufacturer can’t produce enough of an item, companies will stop selling it and substitute something they can keep on the shelves constantly.

In 2020 and 2021, with demand skyrocketing as customers stocked their grocery cupboards during the pandemic, manufacturers halted production of many secondary products to make only the most in-demand items. And even as demand slowed this year and factories returned to more normal capacity, manufacturers still aren’t making as wide a variety of items as they were before the pandemic.

Hormel Foods, maker of Skippy and Spam, and Mondelez, which owns brands like Oreo, are among the companies that have recently said they are reducing the number of products they sell to focus on higher-performing ones.

Angela Ackerman, who runs the Instagram account @Costcoguide with more than 230,000 followers, he said Costco fans often ask him in particular why they can’t find Costco’s Dark Chocolate Dried Mangoes.

“They fall in love with something and they want to see it again,” he said.

Scarcity can boost sales, as Ackerman knows. When he sees a notice at Costco that a prized item is no longer for sale, he buys more before it runs out. “If I know it’s going to end, I’ve had more.”