- Costco is increasingly requiring shoppers at self-checkout lanes to show member ID along with their photo.
- Their CFO told the Wall Street Journal that only a “very small percentage” misuse their cards, but that can add up quickly.
- Membership fees make up approximately 2% of Costco’s total revenue.
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Richard Gallante, CFO, said: Wall Street Journal.
The retailer is increasingly asking shoppers using self-checkout lanes to show member ID with their photo.
The company previously said, “We do not believe it is right for non-members to receive the same benefits and prices as our members.” Insiders.
Even if it’s small percentages, it could affect Costco
The move comes amid an increase in shoppers using non-branded cards to store items at the members-only department store chain.
“It’s a very small percentage of the members who do,” Galante said. Wall Street Journal. “But when you’re dealing with millions of transactions, even a very small percentage is something you want to get right.”
Costco offers Gold Star and Executive memberships, which come with cards for two people at the same address.
The membership formula has a “significant impact” on your profitability and is designed to “enhance member loyalty and provide ongoing fee income”.
Only 2% of Costco’s total revenue comes from memberships
Membership dues accounted for nearly 2% of Costco’s total revenue in the three months ended May 7.
Retailer income Just over $1,000 million In membership dues in that quarter, a 6% year-over-year increase attributed to new member signings.
As of early May, Costco had a total of 124.7 million cardholders, with 69.1 million paying members, about half of whom are executive members.
Galanti told investors last month that Costco does not plan an imminent increase in membership fees.
The retailer last increased its membership fee in 2017, by 10%.
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