3 Costco Changes We Could See With a New CFO in Charge

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There’s a new person in charge at Costco. Will that impact consumers? Read on for some potential changes. [[{“value”:”

On March 15, Gary Millerchip replaced longtime Costco executive Richard Galanti as CFO. And while there haven’t been any major shake ups so far, in time, a new person in charge could mean new rules on the Costco front. Here are some changes Costco members may be in store for with a new CFO at the helm.

1. Membership fee hikes

The last time Costco raised its membership fees was June 2017. Back then, the cost of a basic membership rose from $55 to $60 per year, and the cost of an Executive membership went up from $110 to $120 per year.

Those prices have remained in effect for almost seven years at this point. So it’s not out of line to assume that under Millerchip’s leadership, they’re going to rise eventually.

Galanti has stated repeatedly on Costco earnings calls that the store would raise membership fees in due time, but he never committed to an actual timeline. But given how long it’s been since those fees went up, it wouldn’t be shocking to see an increase within the next 12 to 18 months.

One thing to keep in mind, though, is that if your membership is currently offering you good value, then it will probably make sense to keep your membership even if it gets a bit more expensive. If, for example, you’re currently saving $300 a year on groceries by paying $60 for a basic Costco membership, then it’ll probably make sense to keep that membership at $65.

2. New product offerings

Costco has introduced its fair share of new products through the years. Some of those have hit the shelves, while some have reached the food court.

As Millerchip settles in, we could see new items arrive at Costco, and new services as well. If so, members might be in a position to get even more value out of the $60 or $120 they’re currently paying.

But chances are, there are already some services Costco offers that you’re not taking full advantage of as a member. Did you know, for example, that you can get low-cost eyeglasses and contact lenses at Costco’s optical center, and that you might reap savings on medication by using its pharmacy? It pays to explore all of the benefits your membership currently offers.

3. Changes to Costco’s return policy

Costco has one of the most generous return policies among major retailers. In a nutshell, it will take almost anything back at any time if it doesn’t meet expectations, with limited exceptions (electronics, for example, must be returned within 90 days).

But Costco has also been criticized for being too lenient with its return policy. Recently, a video went viral when the store took back a couch that a member returned after two years. So it wouldn’t be surprising to see Millerchip establish some new rules with the store’s return policy — for example, that you can’t buy a piece of furniture, use it for months on end, get sick of it, and bring it back for a full refund.

To be clear, none of these changes are guaranteed to take place. And while we can expect membership fees to increase at some point, that may not happen until 2025 (or beyond). But if you’re a Costco customer, it’s a good idea to pay attention to announcements that have the potential to impact you financially and help you better manage your membership.

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The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Maurie Backman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale. The Motley Fool has a disclosure policy.

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