Originally published at: https://boingboing.net/2024/06/05/phew-the-1-50-hot-dog-price-is-safe-says-costco-cfo.html
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It’s basically the same thing as the rotisserie chicken. Just a marketing gimmick to get people in the door. Of course the $1.50 price is safe. It’s not priced to generate profit directly on the sale of the hot dogs.
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I read somewhere that Costco makes the bulk of its profits from memberships, and the items themselves have low profit margins. Makes sense: keep the $1.50 hotdog meal loss-leader, increase membership by a few dollars every few years to compensate. (I’m still sore that my membership went up by $20 a few years ago.)
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Yes, that’s why I said it’s the same gimmick as the rotisserie chicken, which is absolutely sold at a loss. However, I suspect they are actually making a small profit on those hot dogs at $1.50 each. Not much, probably a few pennies, but I don’t think they’re losing money on them.
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Even if they’re loss leaders, prices like that make me question the quality and ethics of the products.
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…Costco co-founder Jim Sinegal once threatened CEO Jim Sinegal with death if he ever changed the price.
Big Sheriff Bart Energy.
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“No, I don’t need a new phone.”
“No, I don’t need solar panels.”
“No, I don’t need new windows.”
“No, I don’t need a new furnace.”
$1.50 hot dog. Best price on the carnival midway.
Huh. These are “Kirkland” hot dogs, which are produced in-house at a Costco-owned factory, and poking around it would seem that the dog itself should cost, wholesale, about $.50/dog for a quarter-pound sausage. Double that for transport, add about $.75 for the bun and another .25 for condiments, plus a few pennies for sugar and carbonated water drink . . . . yeah, they’re still losing money on it. It’s good marketing.
That’s close to retail if you get the pack in the fridge section, so it’s probably much cheaper than that.
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I definitely recognize that you know this — the rotisserie chicken reference was a dead giveaway. 
The grocery store where I once worked used eggs as one of its regular loss leaders. The buy one/two get one free deals were to liquidate nearly expired inventory at cost.
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Cool. I need to save the money for the colon cancer I’ll probably get after eating all those hot dogs!
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$60 a year membership fee for a $1.50 hot dog. What a deal.
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If you use it for nothing else, that’ll pay for itself with one a week or possibly less.
I doubt very many people would use it for only that.
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But I like Costco – I have a standard shopping list I use monthly.
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Excuse me, ma’am. Could I get by you to reach that 5 gallon air fryer?
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