8 Things You Didn't Know About Costco

Some of these facts may surprise even the most dedicated Costco fan.

Costco, oh Costco, where would we be without you? Across the country, people are addicted to its low-price staples, free samples, Kirkland products, and most of all the rotisserie chicken and hot dogs.

Perhaps you're a compulsive Costco-er who has bought a car through Costco, wears glasses from the Costco optician, and insured your home, pet, and life through the Costco insurance services. Even so, our peek behind the Costco curtain might contain one or two things that surprise even you.

1. You don't have to be a member to shop at Costco

A Costco membership will set you back at least $60 a year ($120 for the executive option). But there are ways around it, especially if you want to test the Costco waters before you commit. The most obvious way for non-members to shop at Costco is to go with someone who is a member. But that's not always practical, especially as the Costco cardholder needs to make the purchases.

Another is to use a Costco gift card, though you'll need to get a member to buy it for you. Costco Shop Cards range from as little as $25 and as much as $1,000. And anyone can use the Costco pharmacy no matter their membership status. In some states, this also applies to alcohol purchases. Finally, non-members can pay a 5% surcharge to experience the joys of Costco shopping online.

2. Costco's 'secret weapon' is a hot dog

Costco sold over 122 million hot dog and soda combos last year, and retail experts say the $1.50 deal is one of the reasons for the chain's success. The price hasn't increased in over 30 years, and founder Jim Sinegal says it's not something Costco will mess around with. The same goes for its $4.99 rotisserie chicken, the bird with its own Facebook following. In spite of increasing poultry prices, this chook's price tag won't change.

3. There are big name brands behind some Kirkland products, but Grey Goose vodka isn't one

From Starbucks to Jelly Belly, Kirkland teamed up with big names to bring its customers its signature high quality products at low prices. You'll see some of the partnerships right there on the packet, but others are closely guarded secrets. One MoneyWise article confirmed that Duracell manufactures Kirkland batteries, Kimberly-Clark is behind its diapers, and Diamond Pet Foods manufactures its dog food. However, contrary to rumors on social media, Grey Goose does not make Kirkland's vodka.

4. You can save more by stacking discounts and rewards

As with a lot of your grocery shopping, layering rewards and offers can generate great savings. Costco doesn't take manufacturer coupons, but it does offer in-store discounts called "instant savings." You can stack these with cash-back apps that reward on all your purchases, even discounted ones. Credit card rewards are slightly more complicated as Costco only takes certain cards in store. However, those restrictions don't apply online -- you can use any credit card to pay at Costco.com or using the app.

5. Almost one-third of Costco stores are abroad

Costco operates 838 warehouses around the world, and just 578 are in the U.S. and Puerto Rico. Costco's network stretches as far afield as Australia, where it has 13 stores. There are 107 Costcos in Canada, 40 in Mexico, 31 in Japan, and 29 in the United Kingdom. It also has stores in Korea, Taiwan, Spain, France, China, and even Iceland.

6. 91% of its U.S. customers renew their membership

Costco has over 100 million members, and the vast majority of them aren't going anywhere. According to its 2021 annual report, member renewal rates were 91% in the U.S. and Canada and 89% in the rest of the world. Revenue from its membership fees amounted to $3.9 billion last year. To put that in context, its net sales came to $192 billion and its net income for the year was $5 billion. It would be easy to think that membership fees counted for almost 80% of its income, but that doesn't account for the amount of money the company spends attracting and keeping those members. It likely has to swallow a lot of hot dog and rotisserie chicken costs to keep people coming back.

7. At one point, it sold more clothes than Old Navy or Neiman Marcus

In 2019, a Washington Post article proclaimed that Costco sold more than $7 billion of clothing and apparel each year. That's more than Old Navy or Neiman Marcus. As with many Costco urban myths, it isn't clear whether this still holds true -- a lot has happened since 2019 and clothing may not be as big a draw as it once was.

8. You can even book a Costco vacation

Costco Travel offers discount prices on holidays around the world. With upfront pricing, Costco's reputation for customer service, and rewards for executive members, it may be worth a look next time you're planning a trip. Other unexpected Costco items include barns, saunas, musical instruments, and vending machines.

Bottom line

Its first warehouse location opened in 1983, but the original Costco opened in a converted airplane hangar in San Diego back in 1976. Indeed, California is still home to more Costcos than any other state. And today it is one of the largest retailers in the world.

One word of warning for bargain hungry Costco fans: the chain often beats the competition, but it doesn't always come out on top price-wise. There are other grocery stores out there that could save you more. Though of course, other stores don't give you the full Costco experience.