Costco will soon do something it only does 7 times a year
3 min readAs someone who’s been a Costco member for 20 years and an Executive member for most of them, I’m often asked why I continue to pay for access to a store I’m going to spend money at. After all, I could just waltz into Walmart and load up on low-cost groceries and household essentials instead.
But a big part of the reason I’m willing to pay for a Costco membership isn’t just the savings on bulk purchases. It’s the customer service.
Costco has raised the bar on customer service in a way I can truly appreciate. Through the years, I’ve returned clothing months or even seasons after the fact with no hassle. And any time there’s a quality issue with a grocery purchase, I’ve always gotten a refund.
I’m willing to pay an entry fee, so to speak, for a better experience, the same way some people might pay to enter a county fair even if they don’t plan to go on any of the rides.
Of course, I wouldn’t keep paying that fee without the savings. At a time when inflation is up 3.8% annually, according to the Consumer Price Index, I could use a break on things like groceries and cleaning products. But the fact that I love the service I get makes my annual fee a no-brainer.
Costco values employees and members alike
Clearly, Costco is doing something right on the customer service front. During its most recent earnings call, the company announced that it had 40.4 million paid memberships. Costco also saw a 92.1% renewal rate across the U.S. and Canada.
But as much as Costco goes out of its way to please members, it also tries very hard to be a good employer.
Related: Costco adds popular item to food court menu
In fact, Costco is known for its competitive wages and outstanding benefits package. And the reason the company is willing to pay above-average wages for retail is that it knows that a good team is the ticket to member retention.
“Costco’s higher hourly pay is a contributing ingredient to employee buy-in and success,” retail expert Brad Halverson told RetailWire.
And the company has made it clear that it’s committed to treating workers well.
“We will continue to reinvest. That is what we do, both in employees and in pricing and in the business overall and expansion,” Costco CEO Ron Vachris said in March during the chain’s second-quarter earnings call.
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Costco tries to make store closures a rarity
As part of its commitment to great value and customer service, Costco goes out of its way to stay open as often as possible. Not so long ago, Costco added early shopping hours back for Executive members and extended its Saturday hours for all members.
But Costco also needs to strike a balance between being open to members and giving employees the time off they need. That extends to major holidays. And so sometimes, Costco has to make the difficult decision to close.
Costco only closes its doors seven times a year. But one of those closures, Memorial Day, is right around the corner. And unfortunately, members will need to make other plans if they need to grab last-minute items for the holiday weekend.
The other holidays Costco closes for are:
New Year’s DayEasterIndependence DayLabor DayThanksgiving DayChristmas Day
Source: Costco
Of course, what makes Costco’s Memorial Day closure a bit riskier for the company is that many major retailers are, in fact, open that day. Walmart, for example, only closes twice a year for Thanksgiving and Christmas Day.
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But Costco is willing to forgo Memorial Day revenue if it means retaining staff and keeping workers happy — because if workers are happy, members benefit.
And while members may not be thrilled with the closure, the good news is that the store’s extended hours offer plenty of opportunity for shoppers to stock up beforehand.
Maurie Backman owns shares of Costco.
Related: Costco grows big advantage over Sam’s Club
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