Costco makes bold promise on prices that affects all members

When you walk around Costco, there's one thing you can't help but notice. And it's not just the fact that many of the items are supersized.

Costco's prices, even for non-bulk items, are among the most competitive in retail. And that's incredibly important at a time when so many consumers are struggling.

In November, prices for common consumer goods and services were up 2.7% broadly, according to last month's Consumer Price Index. Food costs rose 2.6%, electricity was up 6.9%, and piped gas service was up 9.1%.

Not shockingly, 49% of consumers say their financial situation got worse in 2025, according to a recent Credit Karma survey. And 38% say their top financial concern heading into 2026 is higher living costs and inflation.

Given that high costs may be here to stay, consumers need relief more than ever. And Costco is stepping up to provide it for members.

Costco makes bold pledge on prices

Costco had a pretty good run this past fiscal quarter, according to the company's earnings call.

Specifically:

• Comparable sales rose 6.4%
• Membership fee income rose 14%
• Digital site traffic increased 24%

The company also opened eight new warehouse club stores, bringing its total to 921 worldwide.

Related: Costco sees major shift in member behavior

Costco CEO Ron Vachris also shared some thoughts that consumers may find comforting at a time when everything costs so much.

Vachris told investors, "We will never succumb to not being the best price and driving prices down for our members. That's what Costco is known for. That will always be our leading mantra."

And the company's actions this past quarter prove that Vachris isn't just pandering to members in an attempt to drive loyalty and renewals. At a time when most retailers are raising prices, Costco actually managed to lower the prices of a number of key items.

Costco items with price drops this past quarter

• Kirkland Signature chicken pot pie fell from $4.29 to $3.99 per pound.
• Kirkland Signature bacon dropped from $18.99 to $16.99 per packet.
• Kirkland Signature whipped cream three-packs fell from $10.49 to $8.99.
• Kirkland Signature three-pound walnut bags dropped from $14.49 to $12.99.
  Source: Costco Q1 2026 earnings call

Costco has a winning formula that helps it keep prices down

It's one thing for a major name in retail to pledge to keep prices as low as possible. But Costco is in a unique position to be able to act on that promise.

Costco, unlike other retailers, doesn't rely on individual item markups to drive profits. Instead, the company gets most of its income from membership fees, which deliver consistent revenue. 

Related: Shoppers furious at grocery chain’s new anti‑theft rule

During the company's most recent fiscal quarter, member fee income came to $1.329 billion. That's basically free money for Costco, allowing the company to cut prices on the items it sells.

But that's not Costco's only secret for maintaining low prices. Costco's Kirkland Signature brand also plays a major role in price control.

You'll notice that Costco's notable price drops mostly relate to Kirkland products. Since Costco is able to closely manage its store brand, it's able to cut out intermediaries and reduce costs while maintaining a high standard of quality.

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So when Vachris pledges to keep prices down for Costco members, he means it. 

And if Costco is able to continue on that path in 2026 in the face of inflation and tariff pressures, it stands to grow its membership base even more as consumers search for ways to keep their costs down.

Maurie Backman owns shares of Costco.

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