Aisle-to-aisle groceries have fallen victim to rapidly rising inflation numbers, but Costco members have long flocked to warehouses because some foods have fixed prices that business leaders pledged not to increase. However, recently two treats in the bakery section caught the attention of members because the price is different – and Costco has just confirmed that they are now more expensive.
In a May 26 earnings call, Bob Nelson, senior vice president of finance and investor relations, said the company had been forced to fight prices for some of its flagship items due to the rise in raw material costs this year. Members can rest assured that this does not include the beloved hot dog and soda combo – Nelson quashed rumors of a price increase above $1.50 at the start of the call, calling it ” incorrect information circulating on social media” – but that includes two beloved bakery items.
Evidence has started swirling on social media in recent weeks that the Kirkland Signature Croissant Pack and Kirkland Signature Muffins have become $1 more expensive each. Reddit members noted that the 12-pack of croissants cost $4.99, but are now 20% more expensive. Others saw the iconic boxes of half a dozen muffins for $8.99.
“Reluctantly, we raised the price of our muffins and croissants, I think, $1, because the price of many of these raw materials continued to rise up to two times, three times and four times what ‘it was 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 some deals around the warehouse end up costing the chain money. Although more than 106 million $4.99 roast 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 are not that high, but they will apparently make a difference and help offset the higher production costs that started last year. Nelson admitted that while the production is good, the expense eventually affects the price buyers have to pay.
No further information was given on further price increases in the Costco Bakery and/or Warehouse, but Nelson also noted that members and prospective members will not yet see membership fees increase, as announced the forecasts. He acknowledged that the usual pattern is approximately every 5.5 years, but that “given the current macroeconomic environment, historically high inflation and the burden it places on our members and all general consumers, we believe raising our membership fees today ahead of our typical timing is not the right time.”
This is great news for anyone looking to take advantage of all the benefits of joining Costco, but there’s also a separate deal that ends up giving you money to spend when you join now. Here is all the information you need to know.
Amanda is an editor for Eat this, not that!. Read more