For the first time since 2017, Costco Wholesale (COST) is raising its membership fees.
The warehouse club has announced that it will increase its membership fee by $5 in the U.S. and Canada as of September 1 this year.
The change raises the fee for a basic membership in both countries to $65 from $60.
However, the fee for the higher tier “executive membership” is being raised by $10. Going forward, executive memberships at Costco will cost $130 a year rather than $120.
In a news release, Costco said the fee increases will impact about 52 million memberships in the U.S. and Canada, about half of which are executive memberships.
Analysts have been calling on Costco to raise its membership fees since the pandemic began in 2020. The company has typically raised its fees every five years.
However, Costco delayed raising fees in recent years as inflation and interest rates rose. Chief executive officer (CEO) Craig Jelinek refused to raise membership fees while consumers struggled with food inflation, saying he didn’t want to alienate customers.
Costco relies on membership fees for most of its revenue and to keep prices low at its stores.
Although Costco delayed raising its fees, it did crack down on the practice of shoppers using other members’ cards to access its stores, adding extra checks of membership cards at self-checkout aisles.
Costco’s stock is up 3% on news of the membership fee increase. In the past 12 months, the company’s share price has risen 67% to trade at $881.34 U.S. per share.
