Costco Wholesale announced on Wednesday that it will increase its annual membership fees for customers in the US and Canada for the first time in seven years, effective September 1.
The new fee structure will see a $5 increase for “gold star” and business members, raising their annual fees to $65. Executive members will experience a $10 increase, with fees rising to $130 from the previous $120. The last fee adjustment occurred in June 2017.
These memberships provide a wide range of benefits to customers, including free sample testing, discounts on food, gas, home insurance, travel, and grocery items. Members also receive an annual 2% reward on qualified purchases at Costco warehouses.
Despite the fee increase, the price of Costco's iconic hot dog combo, a staple of the retailer's food court, will remain unchanged. This decision comes in response to a legendary directive from Costco co-founder Jim Sinegal, who famously told former CFO Richard Galanti, “‘If you raise the effing hot dog, I will kill you. Figure it out.’”
When Galanti stepped down in March, there were rumors that the hot dog combo price might be adjusted, but current CFO Richard Millerchip has indicated that the price will stay the same for now.
Along with membership fee hike, Costco has also started to enforce stricter measures to prevent non-members from dining at its food courts. This initiative began in April, aiming to ensure that only members benefit from the retailer’s low-priced food offerings.
Costco operates 871 warehouses across the US and Puerto Rico and generates over $4 billion annually from membership fees. The company's official policy allows members to bring up to two guests with them on each visit, maximizing the value of the membership for their families and friends.
