Costco cracks down on non-members using membership cards

Costco Wholesale is implementing stricter enforcement to reduce instances of people using membership cards that don’t belong to them.

The retailer’s crackdown on membership card-sharing involves having people provide their Costco membership card to a staff member when asked to do so while using self-checkout registers, according to a company statement provided to FOX Business. Costco said its workers "ask for a photo ID" in the event the membership card does not have a person’s picture on it.

Costco already requires showing the cards at normal registers.

"Costco’s membership policy has not changed," Costco told FOX Business. "We have always asked for membership cards at our registers at time of checkout."

Costco said it is now asking self-checkout customers to show their membership cards after observing "non-member shoppers have been using membership cards that do not belong to them" since increasing the availability of its self-checkout service. The company doesn’t "feel it’s right that non members receive the same benefits and pricing as our members," it added.

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Business Insider and The Dallas Morning News earlier reported on Costco’s move. News of the company doing so comes as streaming giant Netflix recently made it so that U.S. accounts can largely only be used by the account owner and people who live with them, unless they pay for an "extra member."

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Costco stated online that its membership cards are "non-transferable" as part of its membership policy. The company reported in late May that its total number of cardholders had hit 124.7 million by the end of the third quarter. 

Costco members can "assign [their] free household card to one other person" that lives with them, according to a customer service webpage. Otherwise, cardholders can have two guests tag along on their trips to the wholesale retailer, though "purchasing items is exclusive to Costco members."

The company also told FOX Business it is "able to keep our prices as low as possible because our membership fees help offset our operational expenses, making our membership fee and structure important to us."

Costco membership fees brought the retailer $1.04 billion in revenues in the third quarter, rising 6% year over year from $984 million in the same three-month period last year, according to the company. 

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In its most recent full fiscal year, the company’s total revenue came in at $226.95 billion. Of that total, about $4.22 billion came from Costco membership fees, while net sales made up the remaining $222.73 billion. Its net income for fiscal 2022 was $5.84 billion.

The company’s physical retail footprint includes nearly 840 total locations, with hundreds in the U.S.