Costco (COST) makes changes very slowly because it uses a very different business model than its rivals. The company runs membership-based warehouse clubs that trade the cost of joining for access to the chain's no-frills warehouses where items are sold at very low prices.
It's a model that allows the chain to move slowly. Costco's core offering is low prices so it does not need to spend money to innovate. That's why the company was able to wait years to offer any sort of online sales. And, now that it has some digital offerings, it does not need to offer all the bells and whistles rivals like Amazon (AMZN) and Walmart (WMT) need to have just to stay competitive.
DON'T MISS: Costco Members Must Remember This Key Rule (or Face the Consequences)
Costco can instead sit back and watch, letting other chains spend money innovating and once a product or a service becomes something the warehouse club needs to add, it can add it cost-effectively. It's an efficient business model built around keeping members happy.
The chain's merchandise, at least a portion of it, changes often, but Costco rarely makes big changes. It does, however, make them when market conditions dictate that it does and the warehouse club recently made a major one.
Image source: Shutterstock
Costco Closes Its Photo Center
Costco used to offer a full photo center in its stores that did things like developing film and printing digital photos. Those were closed down in 2021 as few people shoot pictures on film and printing pictures has become an easy-to-use online service so the warehouse club moves all of its photo processing and printing to its website.
Now, the company has also shut down all products and services from CostcoPhotoCenter.com, CostcoDVD.com, and CostcoBusinessPrinting.com. It shared the news with members via an email that was sent out in early January. The company shared in the email that all online photo-based services would be closed as of Jan. 28.
Costco then directed members to transfer their photos to Shutterfly, a popular online photo company that can print digital photos, put your pictures on mugs, calendars, and pretty much anything else you might imagine.
When the online photo center closed members lost access to any past projects, but they can still transfer them to Shutterfly. The company did allow members to download their photos before the Jan. 28 closure, but now the only option is transferring them.
Shutterfly Makes Costco Members an Offer
As Costco's new photo partner, Shutterfly wants to make the chain's members an offer that's in line with the value they expect from the warehouse club. Costco shared that info on its website along with a message from its new partner.
"Turn your favorite moments into custom photos, stationery, home decor, and gifts in minutes. Our easy-to-use tools make creating premium products at a Costco member value a breeze. Costco members will receive 51% off every Shutterfly order, plus free shipping on orders over $49," the company shared.
Shutterfly does have a bit of a catch in its offers to Costco's customers.
To store your photos with Shutterfly on a continual basis, they now require “Active Participation” in their services -- meaning, you have to make some sort of Shutterfly purchase (even a super small one) at least once in any 18-month period," Krazy Coupon Lady shared.
Shutterfly offers all of the same services Costco used to offer in its photo centers (and many more). The warehouse club has not said how long members will have to move their photos to Shutterfly.
