Costco cracks down on membership card sharing
Costco is cracking down on shoppers who are using other people’s membership cards.
To step up enforcement, it is checking for photo IDs even when shoppers check out themselves.
The membership-based warehouse said it’s noticed an uptick in abuse since it expanded self-checkout.
To step up enforcement, it is checking for photo IDs even when shoppers check out themselves.
The membership-based warehouse said it’s noticed an uptick in abuse since it expanded self-checkout.
Costco is taking a page from Netflix’s book.
The retailer is cracking down on people sneaking into its clubs and trying to shop with other people’s membership cards, it said Tuesday.
Costco stands apart from other retailers because of its business model. The bulk of its earnings come from membership fees, which help cover company expenses and keep prices low. It charges $60 for annual memberships and $120 a year for its higher-tier plan, called Executive Membership.
Membership-based warehouse clubs have attracted more customers and won more of their wallets over the past three years. Shoppers who turned to the clubs to help with pantry loading of toilet paper and hand sanitizer during the Covid pandemic are now going there for cheaper gas and bulk-sized food during a period of inflation.
Walmart owned Sam’s Club has seen a similar lift in business. Its membership count has hit a record high.
Yet even the clubs have felt pressured as consumers pull back because of inflation, or spend on experiences like travel and dining out instead. In the past two quarters, Costco has reported a heavier mix of sales coming from food as demand slows for pricier merchandise and popular pandemic categories like furniture and electronics.
“It rains on all of us during these tougher times, particularly with bigger ticket, discretionary items,” Costco’s chief financial officer, Richard Galanti, said on an earnings call in December.
Shares of Costco have risen nearly 16% so far this year, outpacing the approximately 14% gain of the S&P 500. The stock closed Monday at $523.42.
In cracking down on membership card sharing, can $Costco (COST.US)$ become the second $Netflix (NFLX.US)$ ?
The retailer is cracking down on people sneaking into its clubs and trying to shop with other people’s membership cards, it said Tuesday.
Costco stands apart from other retailers because of its business model. The bulk of its earnings come from membership fees, which help cover company expenses and keep prices low. It charges $60 for annual memberships and $120 a year for its higher-tier plan, called Executive Membership.
Membership-based warehouse clubs have attracted more customers and won more of their wallets over the past three years. Shoppers who turned to the clubs to help with pantry loading of toilet paper and hand sanitizer during the Covid pandemic are now going there for cheaper gas and bulk-sized food during a period of inflation.
Walmart owned Sam’s Club has seen a similar lift in business. Its membership count has hit a record high.
Yet even the clubs have felt pressured as consumers pull back because of inflation, or spend on experiences like travel and dining out instead. In the past two quarters, Costco has reported a heavier mix of sales coming from food as demand slows for pricier merchandise and popular pandemic categories like furniture and electronics.
“It rains on all of us during these tougher times, particularly with bigger ticket, discretionary items,” Costco’s chief financial officer, Richard Galanti, said on an earnings call in December.
Shares of Costco have risen nearly 16% so far this year, outpacing the approximately 14% gain of the S&P 500. The stock closed Monday at $523.42.
In cracking down on membership card sharing, can $Costco (COST.US)$ become the second $Netflix (NFLX.US)$ ?
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