Costco’s not planning to raise the annual price of a membership to the warehouse retailer, but members might want to brace themselves for one before too long.
The Gold Star membership, which has been $60 per year since 2017, will remain at the same price, chief financial officer Richard Galanti told investors on Thursday. But he warned them not to expect that price to last forever. (Typically, Costco has increased prices every five years and seven months.)
“It’s a question of when, not if,” he said. “We’ll let you know.”
Costco has been weighing a price increase for at least the last nine months, but Robert Nelson, Costco’s senior vice president of treasury, has expressed concerns that the current economic climate might make it more challenging to retain customers should they do so.
“Given the current macro environment, the historically high inflation and the burden it’s having on our members and all consumers in general, we think increasing our membership fee today ahead of our typical timing is not the right time,” he said last June.
Membership fees are a vital source of income for Costco, directly impacting the company’s bottom line. At the end of the second quarter (its most recent), it boasted 123 million cardholders and a worldwide renewal rate of 92.6%.
Costco membership prices might be holding steady, but the company is experimenting with some prices in its food court. Earlier this week, it raised the ire of some shoppers with the introduction of a $10 roast beef sandwich in one store.
The quarter-pound hot dog and 20 oz. soda combination, however, will remain at the same price ($1.50), despite inflation, the same price Costco has charged since the mid-80s.
Learn how to navigate and strengthen trust in your business with The Trust Factor, a weekly newsletter examining what leaders need to succeed. Sign up here.
