Posted on 06/02/2024 3:23:12 AM PDT by RandFan
(NEXSTAR) – Gary Millerchip, the new CFO and executive vice president of Costco, shared a frank message with investors and analysts while hosting his very first Costco earnings call on Thursday afternoon.
“To clear up some recent media speculation, I also want to confirm the $1.50 hot dog price is safe,” said Millerchip, shortly after welcoming attendees to the company’s Q3 earnings call.
The price of Costco’s hot-dog-and-soda combo, at $1.50, has remained unchanged since the item was added to menus in the mid-1980s. But recent comments from Richard Galanti, Costco’s former CFO, left some consumers feeling uncertain about the item’s future.
...
The story behind Costco’s popular hot dog — and its unchanging price — can be traced back to Costco co-founder James Sinegal, according to former Costco CEO Craig Jelinek.
“I came to [Sinegal] once and I said, ‘Jim, we can’t sell this hot dog for a buck fifty. We are losing our rear ends,’” Jelinek recalled in a 2018 interview with 425 Business. “And he said, ‘If you raise the effing hot dog, I will kill you. Figure it out.’”
(Excerpt) Read more at thehill.com ...
In Costco world, that’s a big thing, but it’s got to kind of be weird to be a CFO of a multi billion dollar company and have to even worry about hot dog prices.
Not me. I eat there every couple weeks but only go for the food. I’m not even sure my Costco card is still active.
Wasabi mustard is unbeatable. I take a Hebrew National all-beef hot dog, wrap it in a soft tortilla, spray on some olive oil, add some of my homemade wasabi mustard, then air fry for five minutes. I'm not sure I'd trust a hot dog from Costco.
Never mind. I’ve never had the Costco hot dog.
I like your hot dog “recipe”; it sounds delicious. (I’ve never used an air fryer. Might have to get one.)
“I’m not sure I’d trust a hot dog from Costco.”
I guess millions do every day and probably are not dropping dead.
Amazing marketing to shareholders. Forget profit margins, dividends and earnings per share. Lets focus on successfully selling $1.50 hot dogs instead.
Don’t let them fool you. They’re still making money with it at $1.50. Soda is pennies on the dollar since it’s all fountain soda. And even if you buy jumbo foot long hot dogs in the supermarket as a consumer, you’re paying about $2 a dog retail. The price to Costco as a direct manufacturer is much much less, as are the price of buns. The margins are not high, but that’s not the point. It’s at worst a loss leader to get people into the stores and fill up their baskets with hundreds of dollars of merchandise. The former CFO is an idiot.
We bought a rotisserie chicken yesterday at Sam’s
That is perhaps the best deal going.
Some Price Club execs left and started Costco, copying everything Price Club did. Eventually they merged as Price-Costco, and after a few years became just Costco.
I worked for Price Club in accounting for several years, in or related to their wholly owned manufacturing plants. I taste tested pizza samples out of the test ovens when it was being researched and developed. I saw the first machines for mixing and packing jelly bellies.
Sol Price preferred the taste of hamburgers made with steer meat. The hamburger plant received 40 pound boxes of 98% lean frozen steer meat from New Zealand. The boxes went through a long microwave to thaw, were mixed in a giant blender with “trim”, fat from USA cows, pressed into burgers, and re-frozen.
Sam Walton respected Sol and Robert Price and their Price Club concept enough, that originally he wouldn’t open a Sam’s in cities where there were Price Clubs. Of those days are long gone. There’s a Sam’s a 2 mile walk away where I get a few items at a good price on a free or borrowed membership. Costco is a 3-mile drive where we buy thousands of dollars annually, but rarely the hot dogs.
Agreed, even if they would need to charge more for it. $2.00 or $2.50. In today's world, the latter would still be a bargain.
I can't walk into Costco w/o buying $200 - $300 worth of stuff and on my way out the door buy a $1.50 hotdog and soda. It's just been impossible for me the past 6+ years now.
I should add that we had a tour of Costco #1 in Bellevue WA by the former CFO. One thing I recall is that the chickens are fed a week longer so that they get bigger. This was about 15 years back.
Yeah, there are some real nasty dogs out there. At a buck and a half, I don't think we could expect much..
And people who shop at Costco are obviously impoverished.
There is a fine line between t-asty and n-asty.. :)
And the fine line is called a hyphen.
I had a hot dog and a glass of water at a local fast food joint the other day. It had onions, hot peppers and a pickle for ~$4.5 which included tax. Yikes.
There’s usually a line of people at the Sam’s rotisserie chicken counter...waiting for dinner. The wife and I can get two meals out of one bird...for about $1.25 each (for the meat).
Notice how we are seeing all these stories right after Her Majesty the Couch Cushion Queen said that Joey told all these places to lower some prices so people will vote for him?
We bought a Sam’s Club Rotisserie Chicken last week and got two meals out of it. Best deal in town.
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