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Costco's new CEO, who joined the company as a forklift driver at age 17, believes one of the retail giant's products is its most valuable – and it's neither its famous hot dog range nor its fried chicken.
It's the Costco membership card.
Costco CEO Ron Vachris, who took over as CEO in January after more than 40 years with the company, told Fortune that “everything” Costco does supports its members.
“The most important item we sell is the membership card,” Vachris told the publication.
Checking Costco membership card. (Photo by Kena Betancur/VIEWpress)
The membership card is critical to Costco's bottom line, accounting for 73% of the company's total income last year, according to its fiscal 2023 earnings report.
In other words, memberships generated $4.58 billion in profit last year, while Costco posted net profits of $6.29 billion.
That's more than the $4.22 billion generated by Costco memberships in 2022 and the $3.88 billion in 2021, indicating growth in that aspect of Costco's business.
Related: GM hires Costco to sell Chevrolet and Cadillac electric vehicles
Costco has recently taken steps to protect its members' profits, even going so far as to crack down on non-members trying to eat in the company's food courts in March.
The company also appears to be setting up digital ID scanning stations at certain locations to ensure its members use their IDs when entering the camps.
Costco membership costs $60 per year for a Gold Star or Business membership, rising to $120 annually for an Executive membership.
Related: Costco may stop selling books year-round. Here's why.
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