Costco’s beloved $1.50 hot dog combo has long been a symbol of unbeatable value at the warehouse club, but now that iconic deal comes with a twist that’s catching shoppers off guard. While the price and classic pairing of a hot dog and soda remain unchanged, the company is tightening the rules on who can actually order it. Find out what you need to know before you next stroll through the food court, and whether this move could change how you enjoy one of Costco’s most famous bargains.
How Costco is tightening access to its beloved hot dog deal
While Costco frequently rotates its menu — swapping out sandwiches or debuting a new cookie to keep the bakery crowd curious — certain icons are considered sacred. At the heart of this “hands-off” list is the legendary $1.50 hot dog and soda combo. This deal is more than just a snack; it’s a corporate mandate.
Founder Jim Sinegal’s legendary defense of the price point remains the stuff of retail folklore. As CNBC reported, Sinegal famously said, “If you raise the effing hot dog, I will kill you. Figure it out.” Management has clearly “figured it out,” but not by raising the price. Instead, they are narrowing the guest list.
Costco has spent the last year tightening its borders. What started with digital scanners at warehouse entrances has now officially migrated to the food court. While the public once enjoyed a “gray area” access to those $1.50 franks, especially at outdoor windows, the food court favorite will soon be exclusive to Costco members.
According to Sporked, “Costco is rolling out membership-verification technology at its food courts that will require customers to show a valid membership card before ordering food, something select locations have already started testing, and that could become more widespread in 2026.”
Since 2024, Reddit users have been documenting the shift, sharing photos of signs that make the new barrier to entry crystal clear. One such sign reads: “Effective April 8, 2024, an active Costco membership card will be required to purchase items from our food court. You can join today. Please see our membership counter for details.”
To streamline this enforcement, many locations are now integrating card readers directly into the kiosks. Before you can even order any food, you’ll likely need to swipe or scan your active membership.
The reasoning behind the move is simple: exclusivity. In a statement reported by Audacy.com, the company explained their stance: “We don’t feel it’s right that nonmembers receive the same benefits and pricing as our members.”
So, for those who have been “hacking” the Costco system for a cheap lunch without paying the annual fee, the party is officially over. The hot dog remains $1.50, but the “cover charge” to get into the building is now non-negotiable.
How food court exclusivity drives operating profit for Costco
While Costco’s $1.50 hot dog is a legendary “loss leader,” the recent policy shift to mandate membership for food court access is a strategic move to protect the company’s most vital financial asset: membership fees.
In the world of retail, Costco is unique because it doesn’t aim to make a significant profit from the products it sells. Instead, it uses high-volume sales to cover operating costs, while the membership fees provide the actual profit.
- Operating profit: Membership fees typically account for 65% to 73% of Costco’s total operating profit.
- Revenue contribution: Although these fees represented only about 1.93% of total revenue in fiscal year 2025, they are almost “pure profit” because they have very little associated cost.
- FY 2026 momentum: In Q1 2026, membership income surged 14% year-over-year to $1.329 billion, bolstered by a fee increase in late 2024 and a growing base of premium members.
By requiring a membership card for a hot dog or pizza slice, Costco is closing a loophole that allowed non-members to enjoy one of the brand’s best “perks” for free. This serves two primary financial purposes:
- Incentivizing sign-ups: The $1.50 hot dog serves as a powerful “hook.” By making it exclusive, Costco nudges frequent food-court visitors toward a $65 Gold Star or $130 Executive membership.
- Protecting the value proposition: Costco’s business model relies on members feeling that their annual fee is a “club entry” that grants them exclusive deals. Allowing non-members the same pricing dilutes the perceived value of being a cardholder.