3 business lessons learned from the Costco food court

Who hasn’t gone to the Costco food court?

Or even better what business lessons can you apply from the Costco food court?

I can’t tell you how many hot dogs, pizzas, and churros I’ve eaten during my childhood at the Costco food court growing up.

If you grew up in an Asian family, there’s a 99% chance that you’ve eaten here with your family… that is after stocking up on a years worth of toilet paper.

The truth is Costco Food Court is KILLING it. It’s the 15th largest pizza chain and has more locations than California Pizza Kitchen. And it sells four times the hot dogs than all sold at MLB stadium each year.

Even though I’ve been here thousands of times, this time I asked myself – what sorta business lessons can I learn from the Costco food court? And here’s something I want to show you, you can pull business lessons from ANYWHERE.

So here you go – these are the three business lessons I came up with while standing in the Costco food court line. And no this isn’t an article where I tell you “Costco uses their $1.50 hot dog drink combo as a loss leader.” That’s boring.

You can actually apply, especially if you’re thinking about leaving your job or if you’re completely lost thinking how to create a kickass product or service.

Are you ready? Read on.

Lesson 1: Everyone LOVES the experience of a good deal

My best childhood memories were spent under that red umbrella and eating with my dad, mom, and brother.

Literally we would share a hot dog drink combo, chicken bake, and combo pizza. Any leftovers would be saved during the week. And of course. No meal is finished without a warm churro and a refilling your drink before you leave.

Week after week, we would always hit up the food court… even if we weren’t buying anything at Costco.

Now that my dad isn’t here anymore – I remember dad’s face and how happy he was. Why? It wasn’t the fact that he was getting a good deal – there’s good deals everywhere. It was the entire experience.

Every time he stepped into Costco felt like he was getting a STEAL. Think about it. You get the FREE samples, the “exclusive” warehouse deals, and the food court.

But you know what everyone hates? That feeling of getting ripped off and not getting your money’s worth. I mean let’s pretend – how would you feel if that SAME hot dog combo was $20?

If you focus on giving them an amazing deal, it’ll create raving fans. If you’re an online business, don’t give a stupid PDF – no one cares about that. Give a free mini course. MAKE your offer a NO BRAINER – just like that Costco hot dog.

 

The truth is – no one likes to be sold, but they LOVE the experience of a good deal. Let’s be real – who EVER complains about the $1.50 hot dog combo?

Lesson 2: Most people are stuck because they aren’t willing to try new things

Have you seen those Costco food court lines?

Recently I checked out the new Monterey Park Costco and the line was LONG AF… FML. Sometimes the last thing you want to do is wait in line just for a churro. But this empty line caught my eye.

And l got curious… what is this kiosk line? Turns out Costco is testing out their food court kiosks to cut down their lines. So I was like F this, left the line, hit a few touch screen prompts, and I was done in less than 5 minutes. The person I was waiting behind was still in the same place.

And it hit me – why would people spend EXTRA time waiting in a long line for the same service? It’s because they’re uncomfortable with new things.

Life is the same way. Most people THINK they want to start a business. But when the opportunity is there – maybe it’s a course to learn a new skill or go to an event, they aren’t willing to do the uncomfortable. That’s why they’re stuck at their job… or in this case a Costco line.

The truth is – if you want different results in life or business, you can’t be comfortable. Do something different outside your comfort zone.

Lesson 3: Costco keeps it simple

Go to your local Costco and count the number of food court items. How many did you count? 

Here’s all the menu items at my Costco.

Which item would you pick? Pretty easy to make a decision, right? Now let’s compare this to a restaurant like Cheesecake factory.

Now – what would you pick off this menu? For me I’m like… Ahhh fuck. I don’t know. Should I get a Factory combo? Ugh. And I need to read the descriptions…

If there’s one thing we can learn from Costco, it’s to keep it simple stupid… AKA kiss principle. Let me ask you – which offer is easier to understand?

Option 1: $1.50 hot dog with drink (with refill)

Option 2: $6.95 OREO® Dream Extreme Cheesecake

No lie – sometime you can get stuck creating your offer and making it more complicated than it needs to be.

Next time you’re stuck, take a step back. How can you make your business more like Costco’s $1.50 hot dog?

Btw in Cheesecake Factory’s case, pictures are worth a thousand words.

If you’re itching to head out to the Costco food court…

I don’t blame you. But as you’re enjoying your Costco hot dog with the refill, think about how you can apply these three things into YOUR business.

Here’s a reminder:

  1. Everyone loves the experience of a good deal
  2. Most people feel STUCK because they aren’t willing to try new things
  3. When in doubt, keep it simple stupid

How can you apply these concepts to your business?

If you like learning business or life advice and want to see my journey going from pharmacist to entrepreneur, sign up for my newsletter here.

Until next time,

Kevin Yee

PS… Want to watch me give out Costco food to homeless people in LA on my birthday?

PPS… Want to watch me in the JK films Costco challenge?

 

PPPS… What other life or business topics do you want me to talk about? Share them below!

 

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