Costco Tightens Membership Rules – Scanning Cards at the Door

Jim Sinegal, Co-Founder and Former CEO of Costco: “Costco is able to sell items at prices lower than our competitors because we buy in bulk, negotiate favorable terms, and pass those savings directly to our members. It’s all about value.”

If you’ve got a craving for that unbeatable $1.50 hot dog and soda combo from Costco, you’d better double-check your wallet for your own membership card because Costco is stepping up its game. The retail behemoth announced that in the coming months, the days of simply flashing your card to a store employee at the entrance are over. Instead, you’ll need to scan your membership card at the door yourself, as part of a broader crackdown on membership sharing.

#Costco is cracking down on membership sharing with new membership card scanners.

The Costco on 10th & Harrison in SF requires you to scan your card before entering.

Expect more to come to the bay real soon#costco #membership #crackdown #kron4 pic.twitter.com/QUxFrZYWbl

— Malcolm Jackson (@Mjackson510) August 12, 2024

Gone are the times when a quick flash of a friend’s card might have snuck you in to score some bulk bargains. Costco’s new rules mean that anyone hoping to stroll through those massive warehouse aisles must scan their own membership card. And for those members who haven’t yet added a photo to their cards, don’t think you’re off the hook—you’ll be required to show a valid photo ID to gain entry. Guests tagging along? They’ll need to be with an active, card-carrying member to make it past the door.

This isn’t just Costco flexing its muscles for fun; it’s part of a broader industry shift. Companies like Disney have already announced that they’re tightening the reins on password sharing for Disney+, and Netflix’s similar move last year stirred up a mix of subscriber growth and grumbling customers. Now, Costco is ensuring that only those who have paid their dues are getting the benefits, particularly after the rise in self-checkout lanes made it easier for nonmembers to exploit the system.

Costco seems to be cracking down on membership-sharing 👀

The wholesale store is reportedly installing ‘scanners’ at the entrance where members will be required to scan their card before entering. Flashing your card will no longer be enough. Thoughts on this? pic.twitter.com/60mmtx9p6E

— Breakfast Television (@breakfasttv) August 9, 2024

Richard Galanti, a top executive at Costco, pointed out that the company is clamping down on the freeloaders who’ve been bypassing membership fees by borrowing cards from paying members. This issue became especially noticeable after Costco introduced self-checkout lines, where the absence of direct interaction with employees created a loophole for nonmembers. During the COVID-19 pandemic, Costco had loosened its grip, allowing others to shop on behalf of members who were trying to stay safe at home. But those days are now behind us.

To ensure compliance, Costco is expanding its checks to include self-checkout lanes. Now, whether you’re in a regular checkout line or scanning your items yourself, be prepared to show your membership card along with a photo ID. The retail giant is making it clear: If you want to shop, you’ll need to prove you belong.

And just when you thought that was the end of the changes, Costco is also preparing to hike its annual membership fees. Come September, Gold Star members will see their fees increase from $60 to $65, while Executive members will face a jump from $120 to $130. With a staggering 128 million members globally, Costco raked in a whopping $4.6 billion from membership fees last year alone, and this new price bump is poised to add even more to that total.

Costco cracking down on non-members taking advantage of deals — here’s how https://t.co/Nt6ywWcoFY pic.twitter.com/uH4lH89xCy

— New York Post (@nypost) August 8, 2024

Quotes

• Charlie Munger, Vice Chairman of Berkshire Hathaway: “Costco has a cult following because people know they’re getting the best value for their money. They have mastered the art of low pricing without compromising on quality.”
• Craig Jelinek, CEO of Costco: “Our pricing is simple: we aim to give our members the best possible value every single day. We don’t play games with sales or gimmicks—just consistently low prices.”
• Warren Buffett, CEO of Berkshire Hathaway: “Costco is a company that always strives to give its customers the best possible deal. It’s a model that works, and their pricing reflects that commitment.”
• Ron Johnson, Former CEO of J.C. Penney: “Costco’s pricing strategy is about trust. Customers know that they are getting the lowest possible price, which drives loyalty and repeat business.”
• Paul Gill, Retail Analyst:“Costco’s success lies in its razor-thin margins combined with high volume. They make a little bit of profit on a lot of items, which keeps prices low and customers coming back.”

Major Points:

• Costco will require members to scan their cards at store entrances, cracking down on membership sharing.
• Guests can only enter with an active member, and those without photos on their cards must show a photo ID.
• The move follows a trend among companies like Disney and Netflix to prevent account sharing.
• Costco’s rule enforcement was relaxed during the pandemic but is now being tightened, especially in self-checkout lines.
• Membership fees are set to rise in September, impacting millions of Costco’s 128 million members.

Lap Fu Ip – Reprinted with permission of Whatfinger News