The United States consumes a staggering 23 chickens per capita per year, totaling more than 7.5 billion units. And being as chicken lovers as we are, Costco has never missed the opportunity to take their slice of that pie.
Obviously, the chain has not been immune to price increases as a result of year-on-year inflation that, in the United States, has exceeded 8.3% in October. But, chicken in particular rose much more: 18.6% between June 2021 and June 2022, a strong impact for the economy of the American families.
The secret of the price Costco chicken
Costco’s rotisserie chicken has always been praised for being an economical lifesaver that can feed to four people for only $4.99, and it may sound crazy, because the same product costs between $6 and $10 in other stores or restaurants.
In 2015, a senior Costco executive said that its price can be kept low because the company considers roasted chicken to be a “loss leader”. That means that its purpose is not to generate profits, but to attract customers to buy other products with higher profit margins, such as bulk toilet paper or large bottles of mayonnaise and ketchup.
In 2019, when inflation had still not gone crazy, Costco made an even more intrepid business decision to be able to keep the price low: it installed its own chicken hatchery, slaughterhouse and final products’ factory in Nebraska, and hired nearby producers to raise more than 100 million birds a year. With this, the chain saves about 35 cents per chicken.
Doubts, criticisms and changes
You won’t believe this, but Costco’s chicken is so famous and acclaimed, it has its own Facebook page with over 19,000 followers. On that page, they also ask the company to implement more ethical and respectful practices with animals, a claim that have been backed by several organizations that fight for animal rights.
The company has responded by making some improvements, good ones compared to other chicken production companies in the country, but insufficient for activists. It’s not much, but it’s something, and it shows that the company has a good disposition. For example, they use a more respectful killing method than other companies, and it pays farmers better.
On the other hand, the environmental impact of giant chicken farms has been criticized, and a 2021 study concluded that air pollution around these industrial complexes is related to about 1,300 premature deaths in the United States per year.
All that said, Costco still needs to make more changes to improve the conditions of the birds it raises to sell, so that those of us who love rotisserie chicken can reach more ethical and environmental friendly products.
