It will soon cost more to have a Costco membership.
Costco Wholesale announced plans to increase annual membership fees by $5 to $10 in the U.S. and Canada. This change takes effect on Sept. 1. It's the first increase in seven years.
The annual fee, last raised in June 2017, will go up by $5 to $65 for "gold star" and business members. Executive members will see an increase from $120 to $130.
"The fee increases will impact around 52 million memberships, a little over half of which are Executive," Costco's press release stated.
Costco's website says the company is "loved by over 133 million members." Perks include free samples, discounts on food, gas, home insurance, travel, and groceries. There's also an annual 2% reward on qualified purchases at its 882 warehouses worldwide.
"Despite inflation, Costco has kept prices low," Felipe Caro, a professor at UCLA, told the Washington Post. "But the membership fee eventually had to go up. It makes sense to do it now when customers really notice its value. Costco’s stock price went up after the announcement, so the market agrees it was the right decision."
Costco reported $24.48 billion in net sales in the June 2024 retail month, ending on July 7. This was a 7.4% increase from 2023.
Revenues from membership fees were up 7.6% in the third quarter of fiscal 2023. Membership fees made up 1.9% of the company's total revenue for the fiscal year.
Costco rival Sam's Club raised its annual membership fees in 2022. The Walmart-owned retailer lags behind Costco in sales. They recently announced that free shipping would only apply to Plus members with a minimum order of $50.