Costco Is Cracking Down on Non-Members. Could Costco.com Be Next?

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Costco is becoming increasingly vigilant about keeping non-members out. Here’s how this policy could extend to its website. [[{“value”:”

Costco is a unique store in that it charges a membership fee for entry. A basic Costco membership now costs $65 per year following a fee hike in September, while an Executive membership that gives you 2% cash back on your purchases costs $130.

But you don’t necessarily need a membership to shop at Costco. If you’re a non-member, you can access a store by going as a member’s guest. And anyone can place an order on Costco.com.

Granted, online orders are subject to a 5% surcharge for non-members. But if you only place orders on occasion, spending 5% more could still be cheaper than paying Costco’s membership fee. A 5% surcharge on a $200 order is only $10. Even if you place an order like this once every two months, you’re paying $60 in surcharges versus the $65 for a basic membership.

But in recent months, Costco has taken steps to crack down on non-member access to its stores. And that begs the question: Will Costco.com be next?

Why Costco wants you to buy a membership

The reason Costco wants more people to join is simple. The warehouse club giant brings in a huge amount of revenue from membership fees. It’s that same revenue that helps Costco offer its wide range of inventory at incredible prices.

Recently, Costco implemented some changes to encourage more people to join and keep non-members away. Not only did it make the decision to ban non-members from its food courts, but it also started installing membership card scanners near store entrances. This makes it even harder for non-members to sneak in.

So far, though, Costco has only cracked down on non-members in the context of its stores. But given this trend, it wouldn’t be inconceivable for the next step to be requiring Costco.com users to enter a membership ID number at checkout — and deny non-members access to the website.

As it is, certain items on Costco.com are designated as members-only. If you don’t have a membership, not only can you not order them, but you can’t even see the price they’re listed at.

But it wouldn’t be shocking for Costco to take things a step further and decide that its website is off limits to people who won’t pay the membership fee. This stance could encourage a lot more people to join, allowing Costco to grow its membership base.

Should you join Costco?

If you like the idea of getting access to Costco without restrictions but hate the idea of paying for a membership, you’ve got a conundrum on your hands. But here’s why it pays to take the leap and buy a membership.

Costco stands behind the memberships it sells. If you buy one and then feel like you’re not getting enough value out of it, you can cancel at any time for a full refund.

For this reason, it could make sense to pay the $65 for a basic membership and see how things go. Keep track of how often you visit Costco and how much money you save each month by shopping there. Then, after a few months, run the numbers.

If you’re visiting Costco once a month and saving $30 each time on groceries and household essentials compared to buying them at a supermarket or big-box store, then clearly, it makes sense to keep your membership. That’s because you might spend $65 a year to save $360.

But if, after a few months, you realize you’ve only been to Costco once and didn’t find many items you needed, then canceling for a refund could make sense. In this situation, though, you’re not out any money, so there’s no risk involved.

It’s too soon to know whether Costco will start limiting website access to members only. But it’s a possibility. You may want to prepare to join Costco and see how it goes. And you may be surprised at the many benefits a membership has to offer.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
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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