⚠ A Fee Is Easier to Cancel Than a HabitModerate threat

Costco's fee has a property its owners rarely dwell on: it is conspicuous. A household that overpays by $200 a year at a supermarket never notices, because the money leaves in eighty separate pieces attached to eighty separate things it wanted. A household paying $65 or $130 to Costco confronts a single, dated, itemised decision once a year, and has to answer a question no supermarket ever asks it: was this worth it?

For most members the answer is comfortably yes, which is what a 92.3% renewal rate means. But the calculation is sensitive to two things Costco does not control. The first is how often the household actually went — a member who visits twice a month clears the fee without thinking, and one who visits twice a quarter has to do arithmetic. The second is the size of the basket, because the value of a warehouse club falls sharply for a smaller household, a smaller kitchen, or a home without a car boot to fill.

Both point the same way demographically. American household sizes have been shrinking for fifty years, urban households store less and drive less, and the fastest-growing retail formats of the past decade have competed on immediacy rather than on unit cost. Costco's answer has been to add reasons to visit — fuel, pharmacy, optical, food — which works and is why frequency mattered so much in fiscal 2025.

Watch the gap between the two components of comparable sales. In fiscal 2025 frequency contributed 5 points and average ticket 1¹. In the third quarter of fiscal 2026 it was 2 and 7², and most of the ticket increase was a 20% rise in the average price of a gallon of gasoline rather than a fuller trolley. Growth carried by price rather than by visits is growth that does not renew a membership.