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by David Chang, ChFC®, CLU® | Published on June 6, 2022
Who makes Costco's Kirkland products?
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Costco launched Kirkland Signature products in 1995 as an umbrella to its different private labels. The name came from the company's original Washington State headquarters. At the time there were about 30 different products, but now there are 364 products under the Kirkland brand.
Companies create their own private labels so they can control the quality of their products. Private labels are typically cheaper than national brands and offer a higher profit margin. Kirkland Signature is known for its high-quality products at low prices, but it may come as a surprise that top national brands are also the third-party manufacturer for Kirkland Signature products. The only difference between them and name-brand is the lower price and the distinct black, red, and white label and packaging.
Many of the big names behind Kirkland Signature are printed on the package, while others are kept a closely guarded secret. Here are some of the confirmed nationally recognized brands behind Costco's Kirkland Signature products.
Several varieties of Kirkland Signature coffee are custom-roasted by Starbucks Coffee Company. In particular, they include the 2.5 pound Kirkland Signature Espresso Blend Coffee, Decaf House Blend Coffee, and Regular House Coffee. The price per pound for Kirkland's Signature House Blend Coffee is $6.20. Costco sells the 2.5 pound Starbucks French Roast Whole Bean Coffee at $9.40 per pound, so you're saving quite a bit by buying the house brand.
In a 2016 interview with Atlanta station WSB-TV, Costco CEO Craig Jelinek revealed that Duracell is the manufacturer of Kirkland Signature Batteries. A 48-count package of Kirkland Signature AA Alkaline Batteries costs $13.99, or $0.29 per battery. Duracell AA batteries are sold on Costco's website at $0.40 per battery, almost 40% more than the same batteries under Kirkland's brand.
In a 2003 interview with Money magazine, Costco's executive vice president Tim Rose stated that Kirkland Signature's Albacore Solid White Tuna is made by global seafood company Bumble Bee. Costco sells the 7 oz 8-count for $18.99 while the equivalent Bumble Bee product sells for $26.90 on Amazon.
Prominent pet websites claim that Kirkland Signature's Dog Food is manufactured by Diamond Pet Foods. Kirkland Signature's Small Formula Chicken & Vegetable Dog Food sells for $1.65 per pound, compared to Diamond Pet Food's equivalent at $1.85 per pound.
In a 2017 interview with the Wall Street Journal, Costco finance chief Richard Galanti confirmed that Huggies maker Kimberly-Clark is the manufacturer of Kirkland Signature Diapers. Costco sells its diapers for $0.18 per diaper and Costco sells Huggies for $0.24 per diaper.
New Zealand's Reynolds name is proudly displayed on the Kirkland packaging. The price per square foot for Costco's heavy duty brand is $0.05, compared to Reynold's at $0.07.
There are also dozens more Kirkland Signature products made by the top national brands. Here are just a few of them:
Costco created Kirkland to ensure a consistent brand that was instantly recognizable. The Kirkland Signature brand exceeded $59 billion in sales last year and accounted for 31% of Costco's total revenue. Kirkland sales have continued to increase as more shoppers recognize that its products are equal to or better than nationally recognized brands. It makes sense, given that many of the top brands are the third-party manufacturers for Kirkland products.
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David S. Chang, ChFC®, CLU® is an award-winning entrepreneur and financial planner with over two decades of experience in the personal finance space. He is a graduate of West Point and a Lieutenant Colonel in the Army National Guard. He has an MBA from the UCLA Anderson School of Management.
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