Here’s How Long Costco Plans to Keep Its Iconic $1.50 Hot Dog Combo

Customers wait in line to order below signage for the Costco Kirkland Signature $1.50 hot dog and soda combo, which has maintained the same price since 1985 despite consumer price increases and inflation, at the food court outside a Costco Wholesale Corp. store in Hawthorne, California, on June 14, 2022. Patrick T. Fallon/AFP via Getty Images

Costco will be keeping the price of its signature hot dog and drink combination inexpensive for customers despite soaring inflationary pressures, although prices for other items at the store may increase.

Costco CFO Richard Galanti revealed the news during the company’s fourth-quarter earnings call on Sept. 22 after being asked whether the retailer would look at increasing the price of its famous combo to offset tightening margins owing to the cheap meal.

Galanti joked that “lightning just struck me,” before adding, “No, we really don’t look at it that way ... there are some businesses that are doing well with margins like [the] gas business in a smaller way, in the travel business, those things help us be more aggressive in other areas, or as you mentioned, hold the price on the hot dog and the soda a little longer, forever.”

“But at the end of the day, no, I don’t think we necessarily look to find places where we can harvest margin,” Galanti continued. But there are different areas. Again, the fresh foods business, the strength in sales for a two-year period where over two years, you had 30 percent and 40 percent, 20-plus percent increase each year.”

“The enormity of the improvement in the bottom line, even now as we’re getting some of that back now, still net-net, we’re better than we were two years ago,” he added. “So all those things help that process.”

According to a May report from Market Watch, if adjusted for inflation, which was 8.3 percent in the United States in August, the hot dog combo would be $4.11 by now.

Costco customers push shopping carts through the parking lot of a Costco store in Richmond, Calif., on March 13, 2020. Justin Sullivan/Getty Images

Americans ‘Just Trying to Survive’

Galanti’s comments are similar to those made by Costco CEO Craig Jelinek in July when he told CNBC’s “Squawk on the Street” program that price hikes wouldn’t impact hot dogs.

Jelinek also said the company would not be raising Costco membership fees, stating that this is “not on the table right at the moment” as it is not “the right time.”

Despite the hot dogs maintaining their inexpensive price, a string of Costco food court items have increased in price in recent months, including the popular chicken bake, which rose from $2.99 to $3.99 in July, and Costco’s 20-ounce soda which jumped from 59 cents to 69 cents over the summer, CNBC reported.

In that same interview in July, Jelinek said he believes that a lot of Americans are in a recession right now and are “just trying to survive with just buying gas and making their house payments, rent payments.”

Although the U.S. economy met the rule-of-thumb definition for a recession earlier this year with two consecutive quarters of negative GDP growth, the National Bureau of Economic Research (NBER) Business Cycle Dating Committee—the official body that declares a recession—has not yet called it a recession.

NBER defines a recession as a “significant decline in economic activity that is spread across the economy and that lasts more than a few months.”