Quick Read
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Jim Cramer says Costco tells suppliers that raise prices it will make a Kirkland version at half the cost, citing Tito’s vodka.
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Costco’s CFO Gary Millerchip says Kirkland saves members at least 15% to 20% versus national brands with equal or better quality.
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Sam’s Club grew comparable sales 4.4% excluding fuel, trailing Costco’s 6.7%, while Target cut prices on over 10,000 items.
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CNBC’s Jim Cramer used his Mad Dash segment on November 11 to explain how Costco Wholesale (NASDAQ:COST) handles a supplier that raises prices. Cramer said Costco tells such suppliers it will make a Kirkland-brand version at half their price, using Tito’s vodka as the example. That take is Cramer’s alone. Costco has not publicly commented on any specific supplier, and the clip cuts off mid-sentence with Cramer saying “Tito’s said, hey, you know, we’re not going to do”.
Cramer described the strategy in broader terms:
“[Costco is] very hard on a lot of the suppliers to try to get inflation down.”
He called it “about keeping America from having too high inflation” and added that “only Walmart has really held the line.”
Kirkland Signature Gives Costco Leverage Over National Brands
Costco management describes the same leverage in its own words. On the fiscal fourth-quarter call, CEO Ron Vachris said:
“We continue to see the Kirkland Signature brand broaden. We continue to introduce strong Kirkland items that are effective tools for us to fight back on pricing.”
CFO Gary Millerchip said Kirkland offers “savings of at least 15% to 20% compared to the national brand equivalent with equal or better quality.” Costco also kept lowering prices on its own label. Kirkland walnuts fell from $13.79 to $9.99, and every quarterly release in fiscal 2026 cited price cuts on Kirkland items.
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