Costco hot dogs have cost $1.50 since the 1980s. Here's why prices aren't changing (2024)

Costco hot dogs have cost $1.50 since the 1980s. Here's why prices aren't changing (1)

Customers wait in line at a Costco food court in Hawthorne, California. Patrick T. Fallon/AFP via Getty Images hide caption

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Patrick T. Fallon/AFP via Getty Images

Fear not, hot dog fans: Costco doesn’t plan to raise the price of its beloved franks anytime soon.

The retailer has been hawking its hot-dog-and-soda combo for a smooth $1.50 since it first hit menus in the mid-1980s.

The price tag has held steady over the years despite inflation — otherwise it would be closer to $4.40 these days.

“People like it because it's delicious and it costs a dollar fifty, which is actually very loyal to the history of what the hot dog is: a low-price food for the masses that is, ideally, good,” explains Jamie Loftus, author of Raw Dog: The Naked Truth About Hot Dogs.

Speculation that the cost of the famed combo might be changing began to heat up in March after Richard Galanti, the company’s then-chief financial officer, told Bloomberg that it’s “probably safe for a while” — not necessarily the guarantee that every hungry Costco member wanted to hear.

His successor, Gary Millerchip, cleared things up in his first quarterly earnings call on Thursday.

“To clear up some recent media speculation, I also want to confirm the $1.50 hot dog price is safe,” Millerchip said.

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That sound bite has since made the rounds on social media, providing welcome relief to the chain’s many hot dog devotees.

Loftus says, "It's a good PR move for Costco to not change this price," adding that it has a humanizing effect on the company.

"It's like a PR slam dunk for them, as has this story always been," Loftus told NPR. "It's like that, 'No, we're not going to change the price. We've got your back.'"

How Costco keeps its hot dog prices steady

Costco did have to raise the cost of certain food court staples — its chicken bake and 20-ounce sodas — in 2022, at the recent peak of food price inflation.

Its treasured $4.99 rotisserie chicken remained immune, however.

That and the hot dog are what experts have called an example of loss-leader pricing — a strategy in which companies sell certain products below their market cost in order to get customers in the door and, ideally, putting even more profitable goods in their carts.

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Galanti had said in earlier earnings calls that revenue from other sectors of Costco helped keep food court prices low, according to The Hill.

Executives offered similar explanations on last week’s earnings call.

Millerchip said that inflation in the third quarter, which ended in May, was “essentially flat” in fresh foods and that the “slight” inflation in food and sundries was “offset by some deflation in nonfoods,” led by the lower freight costs of hardware, sporting goods and furniture.

The chain was even able to reduce prices of some items, including its Kirkland Signature frozen shrimp and pine nuts (from $29.99 to $24.99).

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When it comes to hot dogs, Brendan Witcher, vice president and principal analyst at Forrester Research, told NPR over email that Costco is essentially “‘buying’ customers’ loyalty for whatever price they are unwilling to charge above $1.50.”

It’s not an unusual practice in retail, he said, pointing to the practice of stores giving customers 5% off online orders just for signing up with their email address.

“The retailer is ultimately eating that cost to keep the customer loyal (no pun intended),” he added.

The lore of the hot dog combo, explained

The company said earlier this year that it sold nearly 200 million hot-dog-and-soda combos in the 2023 fiscal year alone.

The low cost of Costco’s quarter-pound dogs — as well as the chain’s oft-discussed commitment to keeping it that way — has earned them a cult following over the decades, spawning memes and fan-made merch.

The tale of the Costco dog dates back to around 1984, when Hebrew National — Costco’s original hot dog supplier — sold hot dogs from a cart outside one of its stores in San Diego. (The company began operating its own hot dog factories in 2008, to cut down on supply chain costs.)

Thus began the evolution of the Costco food court, where shoppers can also find sustenance like pizza slices and chocolate chip cookies.

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Witcher says that this part of the experience has basically enabled Costco to establish its own form of consumer culture.

“No one is buying that hot dog and soda and putting it in with their grocery bags to eat tomorrow,” he said. “The quick-serve restaurant is part of the culture of adventure that Costco has created, much like you'd buy food and a drink at a movie theater, an amusement park, or a concert.”

He doesn’t see a reason why Costco would risk losing customers who partake in that tradition by “removing that cultural connection simply to make an extra fifty cents.”

Loftus says another part of the combo's appeal is an almost-mythical anecdote involving its brush with price inflation, in which then-CEO Craig Jelinek went to his predecessor, Costco co-founder James Sinegal, to broach the topic of increasing the hot dog combo price.

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According to legend, as well as Jelinek himself, there was no room for discussion.

“He said, ‘If you raise the effing hot dog, I will kill you,’” Jelinek recalled in a 2018 interview with 425 Business.

The quip resurfaces regularly in viral social media posts, and Loftus says she has even seen it printed on T-shirts at Nathan’s Famous Hot Dog Eating Contest at Coney Island. For better or for worse, she says, the hype around the Costco dog is real.

"It's a good price, it tastes good, and it has this weird piece of folklore attached to it," she adds.

Costco hot dogs have cost $1.50 since the 1980s. Here's why prices aren't changing (2024)

FAQs

Costco hot dogs have cost $1.50 since the 1980s. Here's why prices aren't changing? ›

That and the hot dog are what experts have called an example of loss-leader pricing — a strategy in which companies sell certain products below their market cost in order to get customers in the door and, ideally, putting even more profitable goods in their carts.

Why is Costco's hot dog still $1.50 when everything has gotten so expensive? ›

The $1.50 deal helps create customer loyalty, he said. “It reminds customers of who Costco is.” Costco loses money selling more than 100 million hot dogs every year, but the company offsets these losses by raising prices on other goods it sells. Costco has increased prices of pizzas and other items at its food courts.

Are Costco hot dogs going away? ›

To be clear, you'll still be able to pick up a $1.50 hot dog and soda for the foreseeable future. What's changed is that the company is no longer saying it will stick with the deal, come hell or high water. The company's CFO, Richard Galanti, recently stepped down after nearly 40 years on the job.

Does Costco make any money on hot dogs? ›

It's all about customer loyalty

There's a reason Costco has kept the price of its hot dog and soda combo intact for roughly 40 years. The company is willing to forgo profits and even lose some money selling the combo at that price to offer great value to customers and retain memberships.

Where does Costco get their hot dogs from? ›

To keep the costs low, the warehouse decided to make their own franks. Now there are several Costco-owned meat processing facilities that supply the warehouses with hot dogs, hamburgers, and other Kirkland brand meat products.

Will Costco never change hot dog prices? ›

Fear not, hot dog fans: Costco doesn't plan to raise the price of its beloved franks anytime soon. The retailer has been hawking its hot-dog-and-soda combo for a smooth $1.50 since it first hit menus in the mid-1980s.

How much did a hot dog cost at Costco in 1984? ›

The price was set at $1.50 at its introduction, and has remained at $1.50 ever since. As of 2024, the hot dog combo would cost approximately $4.40 if the price were adjusted to match inflation since 1984.

Are Costco hot dogs high quality? ›

They Are Great Quality

Those are big chunks, especially considering that some people enjoy a hot dog as a snack between meals. However, as hot dogs go, Costco manages to offer a better quality treat than most. The food court's hot dogs use Costco's own Kirkland Signature brand, so you know exactly where they come from.

Can I eat Costco hot dogs without membership? ›

Sadly, this is no longer true for nonmembers. Since early 2020, Costco has required a membership card to buy anything at the food court, including chicken bakes, barbecue beef brisket sandwiches, ice cream and churros. Costco no longer allows food-court purchases to nonmembers.

Who ate Costco hotdogs for a week? ›

Influencer Joey Kinsley shares his experience shedding pounds while eating only Costco hot dogs for an entire week in an interview with Fox News Business.

Why are Costco hot dogs called Glizzys? ›

With roots in the rap world, a glizzy is slang for a Glock handgun. The evolution of the word to include hotdog. comes from the extended magazine of a pistol, which is about the length of a hotdog. Okay, well, that was a detailed reasoning.

Why are Costco's hot dogs so delicious? ›

Kirkland Signature Beef Weiners are both 10% heavier and longer than Hebrew National hot dogs; they're also made with fresh UDSA Choice cuts or better. Talk about an upgrade! With today's $8 coffees and $5 egg cartons, it's hard to imagine how Costco can sell their jumbo hot dog and 20-ounce soda combo for just $1.50.

Who sells the most hot dogs in America? ›

Ball Park Brand is an American brand of hot dog and hamburger buns and patties made by Tyson Foods, Inc. (NYSE:TSN). In 2022, Ball Park Franks was the leading selling refrigerated frankfurter with 160.7 million dollars in sales.

How many calories in a Costco 1.50 hot dog? ›

Largeman-Roth says that each Costco hot dog with bun contains 570 calories, 12 grams of saturated fat, 2 grams of trans fat, 80 milligrams of cholesterol, 2 grams of fiber, 9 grams of sugar, 24 grams of protein and 1750 milligrams of sodium, so eating that three times a day does a few things to an adult man like ...

How much cholesterol is in a Costco hot dog? ›

Nutrition Facts
Calories 570(2383 kJ)
Polyunsaturated Fat1.5 g
Monounsaturated Fat17 g
Cholesterol80 mg27%
Sodium1750 mg73%
13 more rows

Who owns Costco? ›

Ownership. Costco is mainly owned by institutional investors, who own over 70% of shares. The largest shareholders in December 2023 are: The Vanguard Group (9.10%)

Where to buy Costco hot dog crypto? ›

The most straightforward way is to find a reliable centralized exchange where you can buy Costco Hot Dog, similar to Binance. You can refer to Coinmarketcap.com's Markets section to find the list of centralized exchange the coin is listed on.

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