When economic times are tough there is at least one thing you can rely on… if you’re a Costco member. A hot dog and soda combo that costs just $1.50.
As the U.S. Federal Reserve Bank raised interest rates yet again Wednesday, Costco – a Canadian wholesale retail company – reviewed April sales results. It reported net sales of $17.85 billion for the retail month, 3% up from $17.33 billion last year.
Late last year, Costco CFO Richard Galanti confirmed that the company doesn’t plan to raise the price of the hot dog food court combo – ever, according to CNBC.
Economist Chris Thornberg of Beacon Economics told Audacy’s “Something Offbeat” podcast that it is definitely possible for the retailer to keep offering the franks at that price. That’s even after factoring in inflation that has impacted the market since the price was first set in 1985.
“Why not? Look, Costco’s profit margin is fat enough that they can give away hot dogs to do it,” Thornberg explained. CNBC noted that the company has increased the prices of other items offered at its food court, such as the chicken bake.
While Americans already dealing with record-high credit card interest rates can expect to face more economic pressure with the rate hike announced Wednesday (intended to tame inflation), at least some can take comfort in reasonably priced hot dogs enjoyed while gazing at Costco’s tire selection. According to Costco, it has around 123 million cardholders and 850 locations in more than a dozen countries.
Last month, Costco announced an “increase in its quarterly cash dividend,” and “approved a quarterly increase from 90 cents to $1.02 per share. MarketWatch reported Tuesday that the company’s stock rose, outperforming the market.
“For the 35 weeks ended April 30, 2023, the Company reported net sales of $155.62 billion, an increase of 5.6% from $147.33 billion last year,” said a Wednesday press release from the company.
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