Costco memberships will become more expensive according to CFO
The chief financial officer of Costco said last week that the company will raise its membership fees like Sam’s Club, Amazon, and most streaming services.
In the end, the question is not whether but when the cost will rise.
Costco CFO Richard Galanti repeatedly mentioned during a recent earnings call that membership fees have historically increased approximately every five years. Five years and seven months have passed since the last three price increases.
The most recent cost increase occurred in June 2017, so it’s possible that the next price increase will occur as soon as January if it follows the same pattern of five years and seven months. But don’t anticipate it.
Despite Galanti’s explanation that Costco had “no problem thinking about [raising the membership fee] and doing it ultimately,” he remained “purposely coy” regarding when the price increase might occur.
“If we have to wait a few months or several months, that’s fine,” he said, adding later in the call that amid inflation and fears of a recession, “there’s no rush” to raise the membership fee. He went on to say that Costco feels “very good about where our renewal rates are and then the loyalty that our members have.”
Since the beginning of the year, Galanti has been implying that a price increase for membership would occur “at some point.”
Currently, an Executive Membership costs $120 and a Gold Star Membership costs $60.
Two months prior, Costco contender Sam’s Club raised its Club participation expense without precedent for nine years. Additionally, for the first time since 1999, it increased the price of its Plus membership. This year, additional subscription services like Disney+, Amazon, Netflix, and Hulu have increased their prices.