By Clark 
If you are contemplating joining Costco and envisioning the array of foods and bulk items available at significantly reduced prices, you can commence saving money immediately. Simply by registering.
Membership prices are increasing. Perhaps not today. Perhaps not tomorrow. However, shortly thereafter. The clarity is evident after the wholesale giant’s recent earnings call on Thursday. Costco’s Chief Financial Officer Richard Galanti frequently stated throughout the call, “It is a matter of when, not if.”
Galanti has been alluding to a fee hike for some months, while maintaining ambiguity on the exact timing of its implementation. His remarks yesterday were the most unequivocal hint to yet that an interest rate increase is forthcoming. He referenced months rather than years, thus obscuring the specifics.
“We have no reservations about contemplating and ultimately executing it,” Galanti stated. “We believe we currently hold a robust competitive advantage, and a delay of a few months or several months is acceptable.” He stated, “I will deliberately be evasive regarding the timing of that.”
Costco presently imposes an annual cost of $60 for a basic “gold star” membership, permitting cardholders to buy both in-person and online, and $120 for executive-level members, which encompasses additional benefits. The tariff has remained unchanged since June 2017, when the annual price increased by $5 for gold members and $10 for executive members.
Competitors of Costco, Sam’s Club and Amazon Prime, both increased their membership rates early this year.
Costco is infamously resolute in preserving its low price points, including membership fees and their renowned rotisserie chicken, which remains at $4.99 despite increasing poultry costs. That attitude is profoundly embedded in the company’s operations.
Galanti observed that Costco’s revenue from fresh food sales declined in the latest quarter, mainly due to the wholesaler’s decision to maintain its rates despite rising food expenses. By maintaining low costs, Costco anticipates increased sales, which will result in greater profits due to larger volume. He stated, “We believe that individuals do observe those price discrepancies.”
Historically, Costco’s latest fee adjustments (2006, 2011, 2017) occurred approximately five years and seven months apart, as highlighted by Galanti. If the trend persists, the subsequent fee rise may occur as early as January 2023. “That does not imply it will occur in January 2023,” he emphasized.
Galanti stated, “We do not employ any analytical framework aside from our strong confidence in member loyalty and our overall strength,” dismissing analysts’ inquiries regarding potential triggers for a price rise, including a slow U.S. economy and reduced shopper traffic. Costco recorded net revenues exceeding $54 million in the last quarter, reflecting an 8 percent gain, however it did not meet experts’ projections.
Galanti stated, “We could have accomplished it yesterday, and we can also do it six months from now.” “We shall await the outcome.”
According to Galanti, Costco generated $1 billion in sales alone from membership fees in the last quarter. The wholesale club’s membership currently totals 66.9 million globally, reflecting a 7 percent increase from the previous year.