Shopping at Costco requires an active membership with some minor exceptions.
In some markets, the warehouse club has to open its liquor stores to everyone. You can also use a Costco gift card to shop at the retailer without being a member, but only for the value of that card. And first of all, only real members can purchase Costco gift cards.
Related: Costco addresses a problem bigger than retail theft
costco (COST) – Get a free report It also allows non-members to access select items through its partnership with Instacart. It's a limited selection and non-members pay 5% more than the in-store or member price, but it can still be cheaper on many items than a traditional grocery chain like Kroger or Publix.
Warehouse club members may also bring two non-member guests. Those guests can purchase, but the actual member has to pick up and pay for the items.
Basically, Costco wants to preserve the value of membership by allowing its members only access to its warehouse clubs. They have recently become more aggressive about checking IDs at checkout to make sure the cardholder is actually the member.
Image source: What works Djansezian/Getty Images
Costco tests new membership policy
These days, anyone can walk into a Costco. The chain only checks your membership card when it comes time to pay for your purchases. At some locations, Costco has a worker visually check to make sure members have a membership card before they can enter the store.
In theory, that means non-members can window shop and participate in free samples if they so choose. The warehouse club, however, has been testing a major membership change at its Issaquah, Washington location, which is relatively close to its Bellevue, Washington headquarters.
“However, the Issaquah location has reportedly added two kiosks at the main entrance, requiring customers to scan their membership cards. before entering the store”, parade.com reported.
Photos of the new system have appeared on social media. The new system works a little like the manned passport facial recognition stations at some cruise ports (albeit with a human verifying that it is you).
“You will be asked to scan your membership card before entering the warehouse,” posted a reddit user. “I didn't see it in the photo, but there are two scanners at the entrance with an employee at each… There is a screen that shows his face for the employee to review.”
This is a major policy change and could result in a wait to enter the chain's warehouses during peak hours. On the plus side, checking at the door will prevent people trying to purchase with someone else's card from being stopped at the register. This creates a situation where store workers have to put items back on the shelves and, in the case of fresh food, this can lead to waste.
Costco continues to add members
While Costco is past the period in which it typically raises membership prices, it hasn't. The chain's chief financial officer, Richard Galanti, has said that the company would, at some point, increase the price of its memberships, but that a date for that to happen has not yet been set.
Galanti spoke about membership growth during the network's presentation. first quarter results call.
“Membership growth continues. We ended the first quarter with 72.0 million paid household numbers, up 7.6% from last year, and 129.5 million cardholders, up 7.1 % with constant growth throughout the quarters,” he said.
The warehouse club has also been growing its more expensive executive membership base.
“At the end of the first quarter, we had 33.2 million paid executive members, an increase of 939,000 over the 12 weeks since the end of the fourth quarter. Executive members now represent just over 46% of our paid members and a little more than 73% of global sales,” he said. aggregate.
Executive members pay $120 a year instead of $60 for a standard Gold membership, but get 2% cash back up to $1,000.
Get exclusive access to portfolio managers' stock picks and proven investment strategies with Professional with real money. Start now.
