Costco fans fume as new store rules come into effect
Costco’s crackdown on a major loophole in outdoor food courts began this week.
New rules require staff to ask for a Costco membership card for purchases at its 18 outdoor food courts across America.
Until now, staff had turned a blind eye to non-members stopping by for the iconic $1.50 hot dog and soda combo at the outdoor food courts.
Staff normally check cards as customers enter the stores, meaning non-members normally cannot eat at indoor food courts. But servers at outdoor food courts in parking garages almost never checked. That has changed with the new rule.
Members have welcomed the move — saying it will cut some lines — but non-member Costco fans who took advantage of the loophole have complained.
Costco employees have been instructed to check if customers are members when using the food court
Costco warns it will crack down on a loophole that allowed people to use its food courts even if they weren’t members
Gary Millerchip is Costco’s new CFO. He took over in March. It is not clear whether he supports the stricter rules for non-members at food courts
A Costco member wrote on
Another member wrote on X, “If you don’t have a Costco membership. You can no longer get food from their food court. Started today.
They received the answer: ‘Good. No more long lines for pizza.’
The original poster added, “I’m not mad about it for that reason. Hopefully the lines won’t be so long anymore.’
Another member said on X: ‘Amazing. Maybe now I can get a seat in the food court.’
But in response, a non-member complained: ‘This is incredibly stupid and I hope it backfires. I’m sorry, but a seat in the Costco food court is not enough to deprive people who need it of access to affordable food.
“It will hurt those who need it more than members who don’t need it.”
A Reddit user posted a sign outside an Orlando outlet that read, “As of April 8, 2024, an active Costco membership card will be required to purchase items from our food court.”
Costco’s $1.50 hot dog and soda is a big hit among members and has been the same price for decades
There has always been a rule that people need a membership to enter warehouses. This means that non-members generally do not have access to indoor food courts.
But at Costco warehouses with outside food courts or a kiosk, people without memberships have been able to bypass checks.
As a result, many non-members have become accustomed to being able to purchase the $1.50 combo or other favorites.
It’s the latest attempt to crack down on customers who share membership cards.
Staff at a warehouse in Washington — near the company’s headquarters — began scanning customers’ cards before they entered in January.
This shows a photo of the card holder on a screen, which the employee at the entrance can compare with the person standing in front of him.
Normally, customers simply show their card to that employee, who may or may not choose to scrutinize the small photo printed on it.
The new system is thought to be a trial ahead of a possible wider rollout.
Costco charges $60 or $120 annually for a basic or executive membership, but is widely expected to increase membership fees soon. The official policy is that anyone with a card can bring two guests on each visit.
Membership fees are an important source of income. A recent earnings report showed they were coming in $1.11 billion for the three months for the year ended Feb. 18, compared with $1.03 billion a year ago.
Costco’s chief financial officer is stepping down after 40 years — and he gave an interview last week about a topic the members are obsessed with.
Pictured is the setup at the entrance to the Costco warehouse in Issaquah, Washington, that allows a store employee to view the photo associated with a membership card
Costco’s membership fees typically account for more than half of the company’s profits
In a 2022 earnings call, Galanti told analysts that the $1.50 price was “sacred” and would remain at that level “forever.”
But this week he gave a less definitive answer when interviewed by Bloomberg.
This week he was asked, “What happens to the $1.50 hot dog and soda combo while you’re gone?”
His response was, “It’s probably safe for a while.”
That’s not as clear as the outlook he gave in 2022 – when he called the deal “sacred.”
Costco fans will now be looking for a clearer answer from Gary Millerchip, the former Kroger executive who is taking over as CFO.
He will likely speak next about Costco’s quarterly earnings expected in June.