8 Things You Didn’t Know About Costco

A woman and two men wearing safety vests unpack a pallet of boxes in a warehouse.

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Some of these facts may surprise even the most die-hard Costco fan.

Important points

  • Costco is full of surprises – not only are there ways to shop there without being a member, you can even book a Costco vacation.
  • The grocery store has garnered an almost cult following with its low-cost food court and commitment to quality at low prices.
  • Stacking discounts is a great way to save more on your everyday purchases.

Costco, oh Costco, where would we be without you? Across the country, people are addicted to the cheap staples, free samples, Kirkland products, and most importantly, fried chicken and hot dogs.

Perhaps you are a compulsive Costcoer who bought a car from Costco, wears glasses from Costco Opticians, and has your home, pet, and life insured through Costco Insurance Services. Still, our peek behind the Costco curtain might reveal a thing or two that will surprise even you.

1. You don’t have to be a member to shop at Costco

A Costco membership will set you back at least $60 per year ($120 for the Executive option). But there are ways around this, especially if you want to test the Costco waters before committing. The most obvious way for non-members to shop at Costco is to go with someone who is a member. But that’s not always practical, especially since it’s up to the Costco cardholder to make the purchases.

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Another option is to use a Costco gift card, although you’ll need to get a member to buy it for you. Costco Shop Cards range from as little as $25 all the way up to $1,000. And anyone can use Costco Pharmacy regardless of membership status. In some federal states, this also applies to the purchase of alcohol. Finally, non-members can pay a 5% surcharge to experience the joys of Costco shopping online.

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2. Costco’s “secret weapon” is a hot dog

Costco sold over 122 million hot dog and soda combos last year, and retail pundits say the $1.50 deal is one of the reasons for the chain’s success. The price hasn’t increased in over 30 years, and founder Jim Sinegal says Costco won’t mess with it. Ditto for his $4.99 fried chicken, the bird with his own Facebook following. Despite rising poultry prices, the price of this chook will not change.

3. Some Kirkland products have big brand names, but Gray Goose Vodka isn’t

From Starbucks to Jelly Belly, Kirkland has partnered with big names to bring customers their signature high-quality products at low prices. You’ll see some of the partnerships right on the box, but others are closely guarded secrets. A MoneyWise article confirmed that Duracell makes Kirkland batteries, Kimberly-Clark stands behind its diapers, and Diamond Pet Foods makes its dog food. However, contrary to rumors circulating on social media, Gray Goose does not make Kirkland vodka.

4. You can save more by stacking discounts and bonuses

As with many of your grocery purchases, layering rewards and offers can yield big savings. Costco does not accept manufacturer coupons, but does offer in-store discounts called “instant savings.” You can stack these with cash back apps that reward all your purchases, even discounted ones. Credit card rewards are a bit more complicated since Costco only stocks certain cards. However, these restrictions don’t apply online — you can use any credit card to pay at Costco.com or through the app.

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5. Almost a third of Costco’s stores are overseas

Costco operates 838 warehouses around the world, and only 578 are located in the US and Puerto Rico. Costco’s network extends to Australia, where it has 13 stores. There are 107 Costcos in Canada, 40 in Mexico, 31 in Japan, and 29 in the United Kingdom. It also has stores in Korea, Taiwan, Spain, France, China and even Iceland.

6. 91% of its US customers renew their membership

Costco has over 100 million members, and the vast majority of them are going nowhere. According to the 2021 Annual Report, membership renewal rates were 91% in the US and Canada and 89% in the rest of the world. Membership dues revenue last year was $3.9 billion. For comparison, net sales were $192 billion and net income was $5 billion. It would be easy to believe that membership fees accounted for nearly 80% of its income, but that doesn’t explain the amount of money the company spends to attract and retain those members. It probably has to swallow a lot of expenses on hot dogs and fried chicken to keep people coming back.

7. At one point it sold more clothes than Old Navy or Neiman Marcus

In 2019, a Washington Post Article announced that Costco sold more than $7 billion worth of clothing and apparel each year. That’s more than Old Navy or Neiman Marcus. As with many of Costco’s urban myths, it’s not clear if this is still true — a lot has happened since 2019, and clothes may not be as great as they once were.

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8. You can even book a Costco vacation

Costco Travel offers discounted holidays around the world. With upfront pricing, Costco’s reputation for customer service, and executive member rewards, it may be worth checking out the next time you’re planning a trip. Other unexpected Costco items include barns, saunas, musical instruments, and vending machines.

bottom line

The first warehouse location opened in 1983, but the original Costco opened in a converted airplane hangar in San Diego way back in 1976. California still has more Costcos than any other state. And today it is one of the largest retailers in the world.

A word of warning for bargain-hungry Costco fans: The chain often beats the competition, but it’s not always number one on price. There are other grocery stores out there that could save you more. Of course, other stores don’t give you the full Costco experience.

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