Costco shoppers, brace yourselves. Your beloved bulk-buying haven has officially increased its membership fees for the first time in six years.
While to Costco members, the price hike amounts to $5 or $10 per year, that relatively small amount per member could bring the company about $390 million.
💰 Money Math: As of September 1, the Costco is raising its membership rates by 8.33%. The cost of a Gold Star membership, the basic tier, bumped up from $60 to $65. The Executive membership, which offers a little more bang for your bulk-buying buck, also saw an increase, rising from $120 to $130. While the fees increased, there’s a silver lining for Executive members—the maximum annual 2% cash back reward has been raised from $1,000 to $1,250.
- This is the first membership fee increase since June 2017.
- The hike impacts 52 million memberships, with half of them being Executive memberships.
- With each member paying $5 to $10 more, Costco is poised to rake in an additional $390 million in revenue.
🤨 Between the Lines: Costco wants you to know that this fee hike is for your benefit—or so they say. According to the company, these additional fees will help offset operational costs, allowing them to keep those oh-so-low prices that keep you coming back for more. The company’s CFO warned last year that the price increase was a matter of “when, not if.”
🛍️ The Big Picture: In the competitive world of bulk retail, Costco is playing the long game. Costco relies on its membership model to keep prices low. Even with the fee increase, Costco’s loyal customer base seems unlikely to shrink. But with competitors like Sam’s Club charging less—$50 for a base membership and $110 for its Plus membership—Costco shoppers might find themselves doing some price comparisons.
Costco operates over 600 warehouses across the U.S., and with stricter enforcement of its membership rules, it’s clear the company is doubling down on keeping the savings exclusive to paying members.
