By Elisabeth Buchwald | CNN
It’s soon going to cost more money to get your foot in the door at Costco. But the good news is your hot dog is still $1.50 — for now at least.
The retailer is raising membership fees by $5 to $65 a year in the US and Canada, Costco announced Wednesday. This marks the first time in seven years Costco is raising membership fees.
Additionally, Costco’s premium “Executive Membership” is going up by $10 to $130 a year. But those members will soon be able to earn a maximum of $1,250 in rewards annually versus $1,000 currently.
The company estimated that 52 million memberships will be impacted, a little over half of which are Executive members, Costco said.
Annual fees have been one of the biggest profit-generating areas for Costco, helping it offset expenses to keep its prices down. Last year, Costco earned $4.6 billion in revenue from membership fees, an 8% increase from 2022.
The fee hikes are also occurring as Costco, like streaming companies, has been taking more measures to ensure fewer people are hitching a ride on other customers’ memberships.
Costco’s hikes, which go into effect on September 1, come more than two years after key rivals Sam’s Club and Amazon raised their membership fees.
On Wednesday, Costco also announced that net sales were up 7.4% for the five weeks ended on July 7 compared to last year.
Shares of Costco jumped over 2% in after-hours trading following the news.