Big-box retailer Costco is taking a cue from Netflix and cracking down on shoppers who share their membership cards.
Costco’s crackdown on unauthorized shoppers is in direct response to the growing number of employees who have spotted improper membership card sharing at the retailer’s self-checkout lanes.
To rein in unauthorized card-sharing at Costco warehouse stores, shoppers who use the self-checkout registers will now be asked to present their photo membership ID, a policy change the retailer said will help curb unauthorized purchases.
“We don’t feel it’s right that non-members receive the same benefits and pricing as our members,” Costco said in a statement to Business Insider. “As we already ask for the membership card at checkout, we are now asking to see their membership card with their photo at our self-service checkout registers.”
Considering that the bulk of Costco’s revenue comes from the company’s Gold Star and Executive household membership fees, stepping up enforcement and requiring proof of membership will likely be crucial to guarding against declines in profits.
However, local resident Zach Brooks is not a fan of Costco’s new membership crackdown.
“Some households have family members with disabilities,” Brooks told The Dallas Express. “This policy essentially prevents those support systems from going into a Costco store to complete the shopping for them. And while I get why Costco is stepping up enforcement, it’s just kinda frustrating.”
According to Costco’s 2022 annual report, the company brought in $4.2 billion from membership fees over a 12-month period, making the Issaquah, Washington-based warehouse chain the third-largest retailer in the U.S. behind Walmart and Amazon.
The retailer reportedly has nearly 70 million active membership accounts and roughly 125 million authorized cardholders.
While inventory loss due to theft has not impacted Costco’s financials like it has Walmart and Target, the warehouse chain’s chief financial officer, Richard Galanti, suggested that shrinkage could become a problem if membership card sharing is not stopped.
“We haven’t seen any major change in shrinkage,” Galanti said during a recent earnings call. “We’ve been fortunate in that regard.”
If unauthorized shoppers attempt to use one of Costco’s self-checkout lanes, they not be allowed to check out, according to Business Insider.
