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Why do warehouse / wholesale retails like Costco and Sam's Club charge yearly fees? I personally think the wholesale club fees are worth it, but I wonder why they do it.

5

The snide answer is because they can.

The psychological answer is that it drives loyalty.

Because you have spent money on the membership, you are more likely to go back several times in the year in order to get your money's worth.

Once you are in the store, impulsiveness can have its way with you, as you leave the store with a cart full of items that you didn't know you needed until you saw their low price.

  • 3
    My friend calls it the "$100 store". My wife and I cheer when we leave with total purchases under $30 – MrChrister Mar 29 '10 at 17:25

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