Costco operates on a unique membership model with over 136 million members contributing to substantial revenue from fees. Membership options include 'Gold' for $65 and 'Executive' for $130, which offers benefits such as cash back and early store access. Recent changes allow 'Executive' members early entry into warehouses, enhancing their privileges. These members significantly impact revenue, accounting for 72%. Costco has shown impressive growth, with revenue and stock prices increasing markedly, reinforcing its status as a leading retailer with a dedicated customer base.
Costco’s membership structure includes two tiers: 'Gold' members at $65 per year and 'Executive' members at $130 per year. 'Executive' members benefit from cash back on purchases, insurance access, and early store entry.
Executive members can enter Costco warehouses earlier: from 9 am to 10 am on Sundays through Fridays, and from 9 am to 9:30 am on Saturdays. This privilege was announced on Costco's website.
Although Costco did not specify reasons for the membership changes, 'Executive' members constitute 72% of Costco's revenue, suggesting that additional benefits might encourage even greater membership uptake.
Costco reported a 202% stock increase over the last five years, compared to the S&P 500's 98% rise, showing strong performance and profitability amid the evolving membership offerings.
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