Costco chairman reveals secret luxury hack members should know

The warehouse is known for everyday deals — and pricey finds.

Feb 25, 2025 - 12:39

Costco chairman reveals secret luxury hack members should know

Those of us who have ventured out to the grocery store recently probably share very similar experiences.

For one, many of us were probably dazzled — and a little confused — by all the new products.

The shelves are stocked with fizzing beverages that aren't quite sodas or teas, packaged protein that looks like meat but is made of plants, and the eggs are seemingly nowhere to be found.

And we've all probably been at least a little frustrated by the rise in prices.

Groceries are more expensive than a year ago — and even one month ago.

"The food at home index rose 0.5 percent over the month as four of the six major grocery store food group indexes increased," the January CPI report found. "The index for meats, poultry, fish, and eggs rose 1.9 percent over the month, as the index for eggs increased 15.2 percent. This was the largest increase in the eggs index since June 2015 and it accounted for about two thirds of the total monthly food at home increase."

Costco sells everyday necessities and luxury goods.
Image source: Ting Shen/Xinhua via Getty) (Xinhua/ via Getty Images

Costco offers members key savings

It's pretty difficult to avoid the cost of your grocery bill going up month over month, but some stores are doing their best to protect customers from sharp increases.

Costco (COST) is one of those places.

The membership-only discount warehouse charges customers $65 per year for the opportunity to peruse its aisles.

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Because it sells most of its inventory in bulk, it's able to negotiate better prices for large orders. This translates into savings for members who don't mind buying three dozen eggs or 10 pounds of flour at a time.

Costco chairman reveals luxury strategy

But members don't just love Costco for its cheap goods.

Many folks love the discount warehouse because it also sells premium goods like top- shelf liquor and diamonds at competitive prices.

In fact, Costco even offers savings on luxury items like sports cars and luxury watches for the supremely savvy customer. And Costco board of directors chair Tony James says there's a strategy to this.

“Since the beginning, we’ve always known we could move anything in volume if the quality was good and the price was great — Rolex watches, Dom Perignon, 10-karat diamonds,” he said. “A Porsche dealer in Seattle put their cars on the floor of a Costco, and they sold out in a week.”

“Affluent people love a good deal,” James added.

Costco also turned heads when it revealed it's selling around $100 - $200 million in gold bars every month.

James says it's all a part of Costco's philosophy of catering to economically savvy deal hunters.

"I don’t know if affluent people are buying them [gold bars] or just people suspicious of the economy,” he explained, adding, “My point is we’re not interested in selling just anything at a low price. If someone wants to buy a $500 TV for $250 at Costco, we want to sell them a $1,000 TV for $500 instead.”