Costco's New Early Access Hours Boost Executive Member Benefits Amid Global Expansion

Generated by AI AgentWord on the Street
Monday, Sep 1, 2025 11:01 am ET2min read
Aime RobotAime Summary

- Costco grants Executive Members early store access (9-10 AM) from Sept 1, 2025, excluding Saturdays, to enhance their $130/year membership value.

- The policy aims to differentiate from competitors like Sam's Club and incentivize lower-tier members to upgrade via exclusive perks and rewards.

- Executive Members, though less than half of total members, drive significant sales, with Costco reporting $3.6B in membership fees for Q1-Q3 2025.

- The strategy aligns with global expansion plans, targeting 914 warehouses by year-end, while addressing mixed reactions about reduced access for non-Executive members.

Costco is implementing a significant change to its operational hours specifically benefiting its Executive Membership holders. As of September 1, 2025, these upper-tier members will have exclusive early access to

stores from 9 a.m. to 10 a.m., with the exception of Saturdays when the early shopping period will conclude at 9:30 a.m. The early access window applies across Costco's food courts, optical centers, and pharmacies—highlighting the benefits of the Executive Membership, which costs $130 annually.

This adjustment positions Costco against competitors like Sam's Club, which already offers early access benefits to its higher-tier members. The decision aligns with efforts to reward Executive Members, who represent a smaller segment of Costco's membership base but contribute to a substantial portion of the company’s sales. Executive Members enjoy various perks such as a 2% reward on qualified purchases and monthly credits for orders placed through the "Same-Day" service or via Instacart.

The introduction of early shopping hours is a strategic move by CEO Ron Vachris, aiming to enhance the in-store experience and potentially entice lower-tier members to upgrade their memberships. Lower-tier memberships, including Gold Star and Business options, cost $65 annually. Although these provide basic access to Costco’s offerings, Executive Membership holders have more added benefits, which could motivate regular members to consider the upgrade.

Costco’s operational changes are not isolated to store hours; the company recently extended operating hours at its North American gas stations earlier this year. With the aim of benefiting its most loyal customers, the early shopping window is part of Costco's broader strategy to enhance its membership value proposition.

This change comes as Costco experiences remarkable growth, reporting almost $3.6 billion in membership fee revenue for the first three quarters of 2025 alone, with a total of $4.8 billion in revenue last year. Such numbers reflect the strong loyalty among its members, boosted significantly by the company's decision to expand benefits for those at the executive level.

The company has been gradually preparing its members for this transition by providing a grace period since June, allowing all members early access to adjust. This grace period ended on August 31, paving the way for strict enforcement of the new policy. The intention behind the change is clear: to acknowledge and reward Executive Members for their loyalty and significant contribution to sales.

Despite these enhancements, the policy has sparked mixed reactions. A segment of Costco shoppers has expressed dissatisfaction, feeling that the policy may alienate regular members by reducing their shopping hours at stores that previously opened at 9 a.m. The company hopes that the promise of less congested shopping experiences and reduced checkout lines will outweigh concerns as dedicated shoppers might opt to enhance their membership status to enjoy these benefits.

Costco's operational strategy also sees an expansion outside the United States. As per its earnings call, the company projected reaching a total of 914 warehouses globally by the end of the fiscal year, including new locations in Sweden, South Korea, and Canada. This expansion reinforces Costco's commitment to capturing a wider international market, leveraging its robust membership model.

While Executive Members account for less than half of the total membership, their contribution to sales is compelling. They hold substantial value in their shopping habits, presumably incentivized by the numerous benefits their membership offers. The addition of the monthly $10 credit for orders over $150 further strengthens Costco's appeal to its most valuable customers.

Costco’s forward-thinking approach in elevating its membership model underscores its strategic positioning in the market. Offering benefits like early access and rewards not only serve to boost customer satisfaction but also contribute to sustaining the company’s growth trajectory as it continues expanding its footprint both domestically and internationally.

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