Costco is moving full steam ahead with plans to automatically scan customers’ cards at the door to weed out people who share their membership with others.
The wholesale retailer recently Announced that scanning devices will be installed in all warehouses in the coming months.
Card scanning machines have been seen in several locations in California, KTLA reported, specifically in Huntington Beach and Inglewood.
Branches in New York, Florida and Pennsylvania said they will soon begin verifying members this way, but did not specify an exact date. A branch in Texas will likely begin next month.
Guests who want to shop will now need to be accompanied by a member, ending the ability for parents to send their children to shop at Costco while they stay home.
Pictured here is a setup at the entrance to a Costco warehouse in Issaquah, Washington, that allows a store employee to view the photo associated with a membership card.
Costco also requires customers to show a photo ID along with their membership card.
“Additionally, if your membership card does not have a photo, please be prepared to show a valid photo ID. We encourage you to stop by the membership counter to have your photo taken to be placed on your card,” Costco’s statement said.
Previously, customers entering their local Costco weren’t necessarily stopped by an employee to check if they were members.
But last year, company executives told workers it was time to rein in multiple buyers.
“We don’t believe it’s fair for non-members to receive the same benefits and pricing as our members,” the company told Business Insider in June 2023.
‘As we already ask for the membership card at the checkout, we now ask to see your membership card with your photo at our self-service checkouts.’
With its new strategy to verify whether customers are actually members, Costco appears to be following Netflix’s example. The streaming service cracked down on password sharing, leading to a huge increase in revenue and subscriber numbers.
The reason Costco has gotten stricter about membership verification is simple: Restricting access helped boost profits to $1.68 billion in the third quarter ending May 2024, up 29 percent from a year earlier.
Costco first implemented the card-scanning scheme in Washington state, near the company’s headquarters.
The reason for doing so is simple: restricting access helped boost profits to $1.68 billion in the third quarter ending May 2024, up 29 percent from a year earlier.
Ron Vachris, who took over as chief executive on Jan. 1, told investors in May that the idea of scanning members’ cards at the door has made Costco stores even more efficient.
“They’re significantly speeding up our registrations when we have all the scanning in place and memberships are verified at the front door,” he said during an earnings call.
Costco parking lots are notorious for being crowded, a phenomenon made worse by the fact that many stores have their own gas stations. And Vachris said he thinks the new plan will help address that problem.
Pictured: A crowded parking lot at a Costco store in Richmond, California.
Long lines for gas sometimes exacerbate the maneuverability problem in Costco parking lots.
Partially automating the customer check-in process also “rotates parking spaces much faster” and could allow for “gas extensions where needed as well,” Vachris added.
Last year, hundreds of people took to Reddit to complain about the parking lots at their local Costcos, with many describing them as “a Mad Max situation” even at the best of times.
“Costco does a lot of things right, but parking isn’t one of them,” one person wrote.
Despite having earned nearly $58 billion in revenue in the third quarter, Costco announced in July that it would raise its membership fee starting in September.
It’s the first increase since June 2017, and will increase by $5 a year for the standard membership, taking it from $60 to $65 annually.