If you're unsure whether a Costco membership is cost-effective for your household, you might want to consider acting fast, as one analyst says the subscription fee is about to become more expensive.
In an interview with Yahoo Finance, retail analyst Michael Lasser said that the retailer is set to raise the price of its membership for the first time in over five years. According to Lasser, the company is likely taking advantage of the current situation to increase its membership fee because the value they provide shoppers is so high.
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"Costco offers a very good deal for the consumer," the analyst told Yahoo Finance. "You pay to shop there. And the reason why you pay to shop there is because you find prices that are as good or better than anywhere else."
Last quarter, Costco experienced a 6.8% increase in same-store sales, primarily due to a demand for staples such as fresh food. Moreover, 92% of U.S. members renewed their memberships, resulting in a 6.2% year-over-year growth of $1.03 billion.
Costco last raised membership prices in June 2017. Lasser said that the company tends to raise prices on an average of five years and seven months, suggesting the next hike is imminent.
"I suspect that they'll announce it later this spring and implement it early this summer," Lasser said. "What they find is that as they get the profit infusion from this fee, because it really is pure profit, that they take a portion of that and reinvest it back in lower prices. And that helps to drive the model. It helps to differentiate Costco versus other retailers out there."
The good news, however, is that Costco CEO Craig Jelinek told Yahoo Finance in December that the retail giant had "no plans to change" the price of its $1.50 hot dog and soda combo.