Costco Refuses to Budge on $1.50 Hot Dog

Since the 1980s, Costco has offered a $1.50 hot dog and soda combo even though, with inflation, it should sit at roughly $4.40, reports NPR.

On a Thursday earnings call, Costco CFO Gary Millerchip said that the price isn’t changing anytime soon, quelling fears after former CFO Richard Galanti told Bloomberg that it was “probably safe for a while,” according to the report.

Industry expert and author of Raw Dog: The Naked Truth About Hot Dogs said that keeping the combo price stable helps the company in the long run.

"It's like a PR slam dunk for them, as has this story always been," Loftus told NPR. "It's like that, 'no, we're not going to change the price; we've got your back.'" He added that it also has a humanizing effect on the company.

When it comes to hot dogs, Brendan Witcher, VP and principal analyst at Forrester Research, told NPR that Costco is “buying’ customers’ loyalty for whatever price they are unwilling to charge above $1.50.” He also said that the practice is common for retail, explaining that it is akin to businesses giving customers five percent off online orders just for signing up with their email address.

“The retailer is ultimately eating that cost to keep the customer loyal,” he said. Full Story