Grocery items from aisle to aisle have fallen victim to the rapidly rising inflation numbers, but Costco members have long flocked to warehouses because some foods have fixed prices that company leaders have vowed not to raise. However, recently two treats in the bakery section have caught members’ eye because the price tag is different—and Costco just confirmed that they are now more expensive.
In an earnings call on May 26, Bob Nelson, the Senior Vice President of Finance and Investor Relations, said that the company has been forced to grapple with prices for some of its signature items because of the rise in raw material costs this year. Members can rest assured this does not include the beloved hot dog and soda combo—Nelson squashed rumors of a price increase above $1.50 early on in the call, calling it “incorrect information floating around on social media”—but it does include two beloved bakery items.
Evidence started swirling on social media in the last few weeks that both the Kirkland Signature Croissant Pack and the Kirkland Signature Muffins have become $1 more expensive each. Members on Reddit noted that the pack of 12 croissants used to be $4.99, but is now 20% more expensive. Others saw the iconic half-dozen boxes of muffins now priced at $8.99.
“Reluctantly, we took up the price of our muffins and our croissants, I think, $1 as the price of a lot of those raw materials have continued to escalate to two times and three times and four times what they were last year,” Nelson said in the call.
Most of Costco’s profits come from membership fees of $60 for a Gold Star and $120 for an Executive Membership, and certain deals around the warehouse actually end up costing the chain money. Although over 106 million $4.99 rotisserie chickens were sold in 2021, it was at a loss. If the same number were sold for $1 more…well that’s $106 million more that could be in Costco’s pocket right now.
Sales of croissants and muffins aren’t that high, but seemingly will make a difference and help to offset the higher costs of production that started last year. Nelson admitted that although production is good, expenses eventually trickle down to the price shoppers have to pay.
No other information was given about other price increases across the Costco bakery and/or the warehouse, but Nelson also noted that members and potential members won’t see membership costs go up just yet either as predictions have said. He acknowledged the usual pattern is around every 5.5 years, but that “given the current macro environment, the historically high inflation, and the burden it’s having on our members and all consumers in general, we think increasing our membership fee today ahead of our typical timing is not the right time.”
This is great news for those looking to get in on all the perks of joining Costco—but there’s also a separate deal that ends up giving you money to spend when you sign up right now. Here’s all the info you need to know.
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