After months of decades-high inflation, a top Costco Wholesale official stated the big-box retailer has no plans to raise the price of its $1.50 hot dog and drink combo at its food court. During the company’s fourth-quarter results call on Thursday, Costco CFO Richard Galanti reaffirmed that the deal’s low price point would remain in place.
One analyst questioned whether Costco was raising prices in other areas of the company To make up for lost margins on its hot dog-and-soda bargain and other value products. Galanti said that higher-margin businesses like gas stations and travel shops help Costco maintain its value deals. He explained, “Those things help us be more aggressive in other areas,” adding that they will “hold the price on the hot dog and the soda a little longer – forever.”
The New York Post reports that over the past year, Costco and other retailers have raised prices, passing on to customers the increased costs of products and commodities. Although it has marginally decreased recently, August’s inflation rate of 8.3% was higher than forecast. According to Galanti, Costco’s price inflation was around 8%, with hikes “a little higher on the food and sundries side” in the fourth quarter. He also noted that Costco has no immediate plans to raise its membership dues.
The beloved warehouse chain now has annual membership fees as low as $60. However, Galanti said that membership fees would probably rise in the future. Historically, Costco has increased its membership fee every five to six years.