Costco is a membership warehouse club whose stated goal is to bring its members the best prices on quality brand-name merchandise. It’s one of the largest retailers in the world. It provides a wide selection of merchandise, the convenience of specialty departments and exclusive member services that are designed to make shopping a pleasurable experience.
Costco members present their membership cards at the door to enter its nearly 900 huge warehouse stores, where they can buy products in bulk at a discounted price. The members leave with carts filled with supplies of necessities like toiletries and detergent, as well as fresh and frozen groceries, snacks, home furnishings, and ornaments.
A typical Costco store carries supermarket items in an ever-changing selection of other merchandise which includes luxury products. It stocks about 4000 different items at any given time.
Most Costco Wholesale warehouses have a discounted gas station on site for members. Other discounted benefits include, traveling, brand tires, pharmacy, glasses, and contacts as well as access to an optometrist, food, etc.
In 2024, Costco Wholesale had 132 million cardholders among 73.4 member household members.
A major source of revenue for Costco is the membership fees, it generated $1.12 billion in the most recent quarter.
Costco membership cubscription increase
Costco announced in its June Sales Report on Wednesday that there’ll be an increase in the annual membership fees for members across all tiers in the US and Canada for the first time since 2017. The new membership prices would be effected from September 1st, 2024. The news came in days after employees were told they would be getting a $1 hourly wage raise.
The retail chain operates 609 locations in the US and Puerto Rico and 108 in Canada accounting for 81% of Costco’s total warehouses internationally.
For the first time in seven years, Costco’s annual membership fees for ‘Gold Star’ members in the US and Canada will increase by $5, the charge was $60, and it increase to $65. It’s also noted that the maximum annual 2% reward for its executive members will rise to $130 from $120 with the membership maximum annual 2% reward increasing from $1000 to $1250. The change in the prices has affected close to 52 million memberships.
When will the membership subscription increase go up
Costco has a history of increasing membership costs every five years or so, but company executives had delayed as shoppers struggled with high inflation.
The membership subscription increase is set up to commence effect on the 1st of September 2024. The fee increase will impact about 52 million paid members, a little over half of which are executive members.
However, the announcement didn’t specify whether people who purchase annual memberships before September 1st will receive a charge for the difference or if they’ll enjoy a lower price until they pay in 2025.
What will the rate look like?
The Gold Star business and the executive membership fees will be raised. The Gold Star and business membership fees will go up by $5, to $65 per year, while the executive membership will go up from $120 to $130. The rate hike will be for Costco members in the US and Canada. However, this raise is not only on the membership fees, as the executive members will also have a cause to smile. Costco is also increasing the maximum annual 2% reward that executive Members usually receive. The annual reward will be increased from $1000 to $1,250.
The membership fee rise was predicted by an analyst, John Heinbockel, in 2021. In his statement, he said, “As is well known, Costco has increased its annual membership fee every five and a half years by $5 to $10.” In his predictions, the “Gold Star fee” will rise from “$60 to $65″ and the executive membership will move from “$120 to $130”. This prediction comes true on September 1, 2024.
