2024-01-16 21:28:00
(CNN) — We’ve got bad news if you use someone else’s Costco membership to get into stores: The retail giant has started taking steps to prevent it.
When you enter Costco, you must show your membership card to an employee to purchase. Costco membership cards are not transferable, but the company allows members to give a second card to someone in their household. Anyone with a card can bring up to two guests during each visit, the company stipulates.
But Costco has found that people without memberships have been entering stores with cards that don’t belong to them, especially since Costco expanded self-checkout.
The company recently began asking shoppers for their membership cards in addition to photo ID at self-checkout registers, the same policy they have for regular checkout registers. “We don’t think it’s right for non-members to receive the same benefits and prices as our members,” Costco said in announcing the change.
Additionally, Costco has now piloted a system that requires members to scan their membership cards at the store entrance, rather than simply showing the card to employees. Some customers spotted the new scanners at a store in Washington state and posted photos on Reddit.
Costco CFO Richard Galanti told CNN that there are more people sharing their memberships since the 2020 pandemic.
Costco is testing the scanners in several stores to see if they are useful. The scanners would also prevent employees from having to ask customers for their membership cards at registers and at self-checkout.
“It speeds up the check-in process and speeds up the checkout process,” Galanti explained. “We believe that and we are going to put it to the test.”
This is the latest example of how Costco and other companies like Netflix are taking steps to prevent membership sharing.
Costco had around 66 million paid members and 119 million cardholders in 2022, making it one of the largest membership clubs in the world. Costco members pay $60 a year for a regular membership or $120 for an “executive” card, which includes additional benefits.
The membership model is crucial to Costco’s business, which has boomed during the pandemic. Annual fees help increase the company’s profits and offset expenses, which in turn allows it to keep its prices low. Any changes to membership growth or renewal rates might hurt Costco and force it to raise prices.
The retailer earned $4.2 billion in membership fees in 2022, a 9% increase from 2021, with a high renewal rate of 93%.
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