Some Costco customers have expressed outrage over the discontinuation of one of their favorite grocery items. And while the warehouse club retail chain has confirmed the news, their reasoning for taking the product off the shelves may surprise you.
An Unhappy Change
Costco shoppers are notoriously loyal to the warehouse retail giant. Why else would they buy a membership just to shop in its stores? However, late last month some shoppers noticed a change in the Costco catalog that left them livid.
Nestle Surprise
On July 31, one Costco customer went to the internet to share a photo they had taken at their local store. The image showed a display of Nestle chocolate chips in 72-ounce bags.
Kirkland Signature vs. Nestle
Typically, Costco stocks Kirkland Signature chocolate chips as its primary chocolate chip catalog item. Kirkland Signature is Costco’s own product line, introduced by the chain in 1995.
“They Replaced the Chocolate Chips”
The image, which was accompanied by the caption “They completely replaced the chocolate chips with Nestle,” sparked fury among Costco members who saw it.
No Longer in the Online Store
While the product can still be seen on the Costco Business Center website, it is no longer listed on the retail giant’s online shopping catalog.
A Baker’s Favorite
Kirkland Signature chocolate chips have long been a favorite of Costco bakers and a staple in many American households. Online shoppers were frustrated enough by the news that some even contacted Costco’s customer service team and received a lengthy reply.
“The Rising Costs of Cocoa
To the dismay of many netizens, a Costco representative confirmed their fears in an email statement. “We have made the decision to discontinue the Kirkland Signature Chocolate Chips across the company due to the rising costs of cocoa,” the representative said.
A 200% Rise
What surprised many was the reasoning behind the switch. The statement explained that “Cocoa costs have risen nearly 200% compared to last year.”
No Longer Competitive
The cost of cocoa has reportedly inflated so far that Kirkland’s Signature brand would no longer be able to compete with the prices of Nestle chocolate products.
Contradicting It’s Motto
The statement pointed out that a more expensive chocolate chip line would directly contradict the Kirkland Signature motto: “equal or better quality than national brands at a value.”
Supported by the Industry
While Costco’s statement may have disappointed chocolate chip fans even further, their reasoning is sound and supported by cocoa and chocolate industry statistics.
WWC Weighs in
The World Wide Chocolate Company is a Brentwood-based distributor of premium chocolates. In April, the WWC released a blog post titled ‘Cocoa Cost Soars to Historic High – Why is Cocoa’s Cost Rising?’
Historic Highs for Cocoa
In the post, the WWC confirmed that international cocoa prices had soared to historic highs this year, and that “analysts are expecting even further increases” later in the year.
231% Increase in March
According to the international market rate for cocoa on March 26th, 2024, cocoa prices had increased by 231.56% since the same day of the previous year.
Flooding Devastates Cocoa Crops
The turn began even earlier, as reported by the International Cocoa Organization (ICCO), which released a report in June. In the summer of 2022, devastating flooding hit West Africa, destroying crops in key regions.
Top Cocoa Bean Producers
Cote d’Ivoire and Ghana, the world’s top producers of cocoa beans, according to WorldAtlas, are both located on the coast of West Africa.
Trouble on the West Coast
Illegal gold mining on cocoa farmlands in Ghana has also contributed to flagging production. Both countries make up 60% of the world’s cocoa supply, according to the WWC, which believes that cocoa prices are unlikely to recover in the next year and a half.
Not Gone for Good
For now, Costco is remaining cautiously optimistic. While they have removed Kirkland’s Signature chocolate chips from shelves across the country for now, it is unlikely to be a permanent decision – though it will still depend on market forces.
Plans to Offer It “in the Future”
“It’s likely we will stay out of [Kirkland Signature Chocolate Chips] for at least 12 months,” the customer service statement elaborated. “But our long-term plan is to offer the item again in the future.”
Willing to Wait
While some online customers still described the decision as a “major disappointment,” others seemed satisfied with the explanation, hailing it as “good transparency,” and confirming their commitment to wait until the Kirkland Signature product returns to their local shelves.
Featured Image Credit: Shutterstock / Idealphotographer.
The content of this article is for informational purposes only and does not constitute or replace professional financial advice.
The images used are for illustrative purposes only and may not represent the actual people or places mentioned in the article.
