The two annual fees I pay to shop for stuff

Thursday’s news that the cost of Amazon Prime will go up from $119 to $139 reminded me that, yes, I do pay this annual fee just to be able to spend more money buying stuff. And then Friday I went on this month’s Costco run, which reminded me of the other annual fee I pay to be able to spend more money buying stuff.

We’ve been paying for these memberships for so long that I had to look it up–we added a Prime subscription in 2012 after free introduction to Prime via the old Amazon Mom promotion ended, while my wife’s Costco membership dates to 2001. Over that time, the cost of Prime has risen from $79 to $99 to $119. The cost of Costco membership, meanwhile, has gone from $45 to $50 to $55 to the current $60 during our tenure, and this pattern of a $5 increase every five years means it will probably hit $65 later this year.

The Costco membership is easier to justify. While not everything in its warehouses will save you money compared to shopping at a grocery store, we easily save enough in purchases like 25-pound bags of King Arthur flour, two-pound bags of yeast, three-liter bottles of Kirkland-brand olive oil and the absurdly-cheap booze at the D.C. Costco to recoup that fee within six months.

The math is more complex at Amazon, since Prime now folds in so many different services and features. Free two-day shipping is supposed to represent Prime’s core value, but most of our purchases don’t require that; meanwhile, I do save enough in Amazon Prime discounts at Whole Foods (as in, the closest full-size grocery store to our house) to offset a large chunk of Prime’s cost. Amazon Music now factors heavily into our household value calculation by virtue of the use it gets on our Echo (as in, our kid asking Alexa to play the Encanto soundtrack), but even as Amazon has invested heavily in creating original movies and series for Prime Video, our viewing hasn’t kept up.

These value equations get even woolier when you factor in the conduct of these companies. By which I mean, Costco is an easy company to like–it’s paid its store employees so well that some Wall Street analysts have whined that it’s too generous–while Amazon is not. The Seattle tech giant has real problems with fake products, fake reviews, occupational safety, and its treatment of third-party sellers and third-party delivery drivers. It collects vast amounts of data about its customers yet barely documents how it responds to government requests for that information.

(You may have noticed that all but the last of those links about Amazon’s issues point to stories in the Washington Post–which Amazon founder Jeff Bezos spent $250 million to buy. That speaks to the character of my old shop and that of Bezos. The other local angle with Amazon is its HQ2 rising in Arlington a few miles from our house and already helping to elevate its value, meaning my wife and I are both personally wealthier and pay higher property taxes.)

But Amazon’s wage increases for warehouse employees, combined with its massive size, have resulted in the firm doing what Washington apparently can’t–elevating the minimum wage across a large swath of the country. And in his last letter to shareholders as CEO, Bezos wrote that his new mission for his company was to make it “Earth’s Best Employer and Earth’s Safest Place to Work.”

Realistically, we’ll almost certainly keep paying what I’ve called the “Amazon citizenship tax.” But I want to know that some of this extra $20 a year will go towards making those goals happen.

2 thoughts on “The two annual fees I pay to shop for stuff

  1. Something else to add in your calculation. If you get and use the Chase amazon prime card you get 5% back. We spent about $9,000 at Amazon last year. That’s $450 back. Even if you use only 3% as a figure since you could always use another 2% card, that extta 3% means $270 cash back. You would need to spend $4800 a year to pay for Prime.

  2. Pingback: Amazon Fresh first look: Just Walk Out, then wait for the receipt and hope it’s accurate | Rob Pegoraro

What do you think?

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.