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Explore How Costco Makes Billions Selling Products at Zero Profit with 80 views, 3 likes, and 2 comments. Experience the impact of this video content that has captured audience attention.

Every retailer on earth follows the same rule — buy low, sell high, keep the difference. Costco threw that rulebook out entirely. In 2024, Costco generated $250 billion in revenue. Their product margin? Under 3%. By every conventional measure, they should barely be breaking even. Instead, they made $4.8 billion in pure profit — and almost none of it came from selling products. In this video, we break down the Costco business model from the ground up — how a grocery bagger from Pittsburgh built one of the most profitable retail operations in history by deliberately making nothing on the products he sold, why 76 million people pay just for the right to shop there, and what the $1.50 hot dog has to do with any of it. What you'll learn: 👉 Why Costco caps its product markup at 11% while competitors charge 25–50% 👉 How membership fees worth just 2% of revenue generate 73% of gross profit 👉 The SKU strategy that gives Costco more supplier leverage than retailers 10x its size 👉 Why Kirkland Signature now outsells Procter and Gamble 👉 The business lessons every entrepreneur and investor can take from this model Chapters: 00:00 — Intro 01:00 — The Context 03:32 — The Paradox 05:21 — The Engine 09:31 — The Proof 12:28 — Business Lessons If you found this valuable, subscribe for weekly breakdowns of the business models, strategies, and decisions behind the world's most successful companies. Business Breakdown is a channel dedicated to understanding how companies really work — the strategies behind the success, the mistakes behind the failures, and the lessons every business builder can apply. Tags: Costco business model, how Costco makes money, Costco membership fees, Kirkland Signature, warehouse retail strategy, business breakdown, business case study, how companies make money, retail business model, Jim Sinegal, Costco vs Walmart, business lessons, entrepreneur lessons, company analysis

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