The “Fees → Savings” Link, or Purchasing Fifty Pounds of Pasta
“One recent survey reported that Costco sells to 1 in every 11 people in the United States and Canada, and warehouse clubs are estimated to be a $120 billion industry today in the United States alone. As a result, many people have had the experience of entering one of these popular clubs and leaving hours later with more goods than can fit in their car. One rational reason for such behavior is that membership clubs do offer lower prices than other retailers. However, HBS professor Michael Norton and coauthor Leonard Lee suggest a counterintuitive explanation.” (Read more.)
From HBS Working Knowledge.