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They have a simple trick - they make the vendor eat any returns.

So vendors won't ship them shit, because they know they'll eat the returns.

I'm sure they do additional curation on top of that, but making them stand behind the product probably gets 80% of the way there.

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That explains why some products are there for a limited-time only. Maybe they were shit or simply had a bad experience at Costco (due to bad faith customers) and decide to stop selling there.

I would never have imagined there was any other policy in retail, at least for big-ticket items like TVs and appliances. Why should the retailer ever eat the returns?

Because Costco takes returns way past the manufacturer's warranty/return period.

So if random brand X wants to keep selling those toilets at Costco, they will sometimes get a deduction from their invoice because a curmudgeon brought in a ten year old toilet that broke.

(Costco had to change this policy on computers and TVs because word got out and people began abusing the policy so much the vendors revolted.)

There are tons of reasons. Most importantly , the retailer controls the point of return, setting terms and allowing or refusing them.

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