Walmart’s Sam’s Club makes bold move Costco won’t follow
The warehouse club has been very aggressive in efforts to take down Costco.
When people join Costco or Sam's Club, most consider the membership fee relatively irrelevant. If you buy regularly at either chain, you certainly get that money back in savings over time, and one big-ticket purchase can more than fully pay back the cost of joining.
Costco (COST) sells two memberships. A Gold Star membership costs $65 and gets you access to the company's warehouses, gas stations and its website.
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Nearly half of its members, however, opt for an Executive Membership, which costs twice as much ($130) but comes with 2% cash back up to $1,250 annually. At the end of the second quarter, Costco (COST) had 36.9 million paid Executive Memberships, up 9.1% versus a year earlier.
"Executive Members now represent 47.1% of paid members and 73.8% of worldwide sales," according to Chief Financial Officer Gary Millerchip.
Sam's Club offers a similar structure. A Club Membership costs $50 per year and gets you access to the chain's warehouse clubs, gas stations and website.
