Why do Costco and other membership discount stores only carry name brands?

Question

Has anyone noticed that Costco only carries heavily advertised name brands. It makes me wonder how much people are saving. At other stores when I buy generic, I save 45% or more. (e.g. Benadryl is Benadryl I don't care who distributes it or manufactures it)

Answer 1

Costco has a large selection of Kirkland labelled products, which is their own "generic" brand.

Answer 2

They don't. BJ's Wholesale Club carries numerous items by "Berkley & James", which is their in-store brand.

With warehouse stores, it's always a matter of price. If they can sell the brand name stuff and make more of a profit than they would by selling the house brand, then they'll sell the brand name. If the house brand is more profitable, then they'll sell the house brand. They don't have any obligation to try to please all customers all the time. They only sell whatever is the best for their profits at that particular time.