Costco Confirms $1.50 Hot Dog Deal Will Stay Amid Inflation Concerns
Costco’s new chief financial officer, Gary Millerchip, has assured customers that the beloved $1.50 hot dog and soda combo will remain at its current price, despite rising inflation.
Addressing recent speculation during an earnings call with analysts on Thursday, Millerchip stated, “To clear up some recent media speculation, I also want to confirm the $1.50 hot dog price is safe.” This was Millerchip’s first earnings call since succeeding Richard Galanti, who served as Costco’s CFO for nearly 40 years.
Amid inflation and changing prices for staple deals at other retailers—such as Trader Joe’s 19-cent bananas and Planet Fitness’ $10 memberships—some had questioned the future of Costco’s iconic hot dog combo, a fixture at that price since 1985. Adjusted for inflation, the combo would cost nearly $4.50 today, but Costco has maintained its price as a strategic loss-leader to attract and retain customers.
Raising the price of the hot dog combo now would be unusual, given that competitors like Walmart and Target are reducing prices to appeal to cost-sensitive shoppers. The $1.50 hot dog has become a potent marketing symbol for Costco, reflecting its commitment to customer value.
Jim Sinegal, Costco’s co-founder, emphasized the importance of this deal in a 2009 interview with the Seattle Times, stating, “We’re known for that hot dog. That’s something you don’t mess with.” Former CEO Craig Jelinek also quoted Sinegal’s firm stance: “If you raise the effing hot dog, I will kill you. Figure it out.”
Costco manages the cost of its hot dog combo by adjusting prices on other food court items and optimizing costs. Recently, the company added a $2.49 double chocolate chunk cookie to its menu, which has been well-received, according to Millerchip.
