For months, Costco has been hinting at an impending increase in its membership fees.
Historically, the popular warehouse club and the third-largest U.S. food retailer increases its fees about every five years or so. The latest bump came in 2017, when the cost of a basic membership rose $5 to the current rate of $60 per year, while a perks-laden “executive” membership jumped $10. at $120 per year.
Paying for a membership allows cardholders to wander the seemingly endless aisles of discounted products at any of the company’s 847 warehouses worldwide.
Analysts have been predicting a further fee increase since at least 2021. Costco’s competitors Amazon Prime and Sam’s Club both raised membership fees last year, while Costco has held firm, even as officials at company have kept everyone on their toes about an inevitable fee hike at some point. .
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Last month, Costco’s chief financial officer, Richard Galanti, told investors “that heIt’s a matter of when, not if,” adding, “I will be deliberately shy when it might happen.”
On Thursday, the company’s shareholders gathered online for their annual meeting, and after a lengthy presentation on the company’s financial performance, the burning question came up again.
And again, officials indicated they were waiting. At least for now.
“In our view, now is not the right time to do this,” Costco CEO Craig Jelinek said, echoing a similar statement he made last summer. “That’s not to say that at some point we won’t, but at this time we have no intention of increasing the fee.”
Costco raked in more than $4.2 billion in membership fees last year, up 9% from 2021, according to the company’s latest annual report.
Raising the annual fee by an additional $5 or $10 might not seem like a lot on an individual level, but for a club with over 66 million memberships like Costco, it adds up quickly.
The latest fee hike boosted the company’s annual revenue by more than $250 million.
Chris Shott is the Associate Grocery Editor for Eat This, Not That! Learn more about Chris
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