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Switching from brand-name to Kirkland Signature products is probably my second-favorite way to save money at Costco. (Number one is to use my favorite Costco rewards credit card.)
I'm hardly the only person who uses their Costco membership to keep the family stocked up on Kirkland products. The Costco house brand has a very devoted -- and very large -- fan base, with the revenue numbers to prove it.
The eye-popping profitability of the Kirkland brand is just one of the surprising facts I uncovered in my search. Let's dive in.
1. Kirkland Signature brings in $56 billion a year
That's right, friends, that's billion, with a "B." The Kirkland Signature line brought in $56 billion in sales last year, which amounts to about 23% of Costco's overall sales.
While that number is small compared to Costco as a whole, it's big compared to -- well, most other companies. In fact, if Kirkland Signature were a standalone company, it would rank 75th in the Fortune 500, coming in above Nationwide, Intel, and TJX. (Costco overall is currently number 11.)
2. The best-selling Kirkland item is toilet paper
Bath tissue sales account for a whopping $1.4 billion of that $56 billion in Kirkland Signature products. Yes, according to Fortune, Costco sells more than $1 billion worth of toilet paper every year.
At around $21.85 a package, this means Costco sold roughly 64.1 million packages, or one package to every two members. (For the curious, that amounts to roughly 3,275 square miles of toilet paper, or enough to cover the entire state of Delaware 1.3 times.)
Pro tip: You can upgrade to a Costco Executive membership to get at least some of that money back via an annual 2% reward. You can also use our credit card rewards strategy to earn even more cash back on your Costco purchases.
3. There are around 550 different Kirkland items
Although it can seem like Costco has a Kirkland Signature version of pretty much everything, the product line is actually fairly small compared to the warehouse giant's overall inventory.
Fortune also says there are around 550 different Kirkland Signature items. Costco is said to carry around 3,800 different products overall, so the Kirkland line makes up just 15% of the product SKUs sold at Costco.
4. Costco deliberately keeps the Kirkland line small
Having a limited lineup of goods isn't an accident -- it's entirely by design. Costco's bigwigs have said repeatedly over the years that the company wants to focus on the quality of its Kirkland line, rather than the quantity of products.
Costco's Chief Operating Officer for Merchandising, Claudine Adamo, put it bluntly in a Fortune interview, saying, "We're not looking to win a trophy for the highest amount of Kirkland Signature SKUs." Adamo continued, "You build loyalty with that brand."
5. New Kirkland products require the CEO's sign-off
To help ensure the Kirkland Signature brand stays true to that high-quality directive, every product has to have the go-ahead at the highest level.
According to Adamo, that means approval from the CEO: "We don't just put our name on products that someone else makes. Any new item goes all the way to the CEO's office for sign-off."
You can't win them all (we're looking at you, Kirkland Light Beer). But ensuring the Kirkland brand keeps quality at the forefront is a big reason why Costco fans are so devoted to the Kirkland line -- and to Costco itself. (Well, that and the $5 rotisserie chicken.)
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We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. Motley Fool Money does not cover all offers on the market. Editorial content from Motley Fool Money is separate from The Motley Fool editorial content and is created by a different analyst team.Brittney Myers has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale. The Motley Fool has a disclosure policy.
