Alright, are we live? Alright, if we’re live, type one. Do me a favor and let me know if you can hear me. Just want to make sure the internet connection’s right. Alright, as I’m waiting for that, we’ve got some big changes happening at Costco. Changes that are going to cost every single person that shops there. And it’s interesting because one of these changes has not happened since 2017, but companies like Costco are doing everything they can to halt these changes because if they start pushing them and prices go up, they’re going to lose business. Alright, the first story is out of CNBC and it’s entitled Costco Hikes membership fee for the first time since 2017.

Now, many people may not think that this is a massive change, but in this day and age where so many people are having a hard time making ends meet, there are certain things that they’re cutting out of their lives. When we read through this story, I’m going to show you another story of one of the reasons why Costco has to raise these membership fees. Alright, again, type one if you can hear me, because the intranet here, the intranet isn’t the strongest. Alright, here we go. You will soon have to pay more if you want to shop at Costco.

Thank you. The membership-based warehouse club said Wednesday that it will increase its membership fee by $5 in the US and Canada as of September 1st. This is an increase to $65 from $60 for annual memberships. Its higher tier plan, called the executive membership, will increase to $130 a year from its current place at $120. Costco said the fee increase would affect about 52 million memberships. Let’s throw this out there, everyone. Do some quick math and let me know what’s 52 million times, let’s say, $5. Just throw this out there. Throw the number down below. And that’s how much, at minimum, they’re going to increase because the higher tier is more.

Shares rose about 2% and extended trading on Wednesday. It’s interesting because shareholders get excited and they get fired up because Costco is going to bring in more money, right? That’s actually not the case. I’m going to show you in this next story why people need to read between the lines and look at other stories behind the mainstream, alright? It says it marks Costco’s first membership rate increase since June of 2017. On average, the company has raised rates roughly every five and a half years, which would have put Costco on track to raise its fees in late 2022 or 2023.

However, Costco held off on raising fees prior to now. In interviews with CNBC, CEO Craig Genelec previously said it was not the right time as consumers dealt with high inflation. Isn’t that interesting? They said it wasn’t the right time last year and the year before is inflation. But right now, a lot of people actually believe or they’re running with the narrative of the Fed or the government saying inflation is coming down. I absolutely do not believe that. As a matter of fact, last time I went to Costco, I’m reminded that inflation is not going down. It says here, Costco relies on membership fees to drive most of its revenue and help keep merchandise prices low.

Its rivals, Walmart, own Sam’s Club, hiked its own membership fee in 2022 for the first time in nine years. Yet even after the fee bump, a Sam’s Club membership was cheaper at $50 for club members and $110 for members of its higher tier level. I’m just curious how many people here shop at both Costco and a Sam’s Club. I have never in my life been to a Sam’s Club and also put down below if you only shop at Sam’s Club. I’m just curious how many people shop at Costco versus Sam’s Club. It says Costco has stepped up its enforcement last year to make sure shoppers were not using other membership cards.

It added an extra check for memberships in self checkout aisles. The move was reminiscent of Netflix, which also cracked down on people who use its service without paying. All right, so let’s do this. Let’s take you to another story and explain why they had to raise their fees. This story comes today out of Business Insider. It’s interesting how we get this blitz all at once, yet the media is not telling you both sides of the story. This story again, Business Insider, it’s entitled Costco’s hourly workers are getting a raise. Read the CEO’s memo. Well, now think about this.

Costco, to be honest, everyone I’ve ever spoken to that works at a Costco loves it. They like their pay. They like their benefits. They’re happy there. I’ve never really spoken to someone. If there’s anyone down that works at Costco, hashtag I work at Costco. Let us know down below. I work at Costco. Don’t hashtag it. It’s a long hashtag. My point being is they like it, right? Well, Costco needs to retain good employees. One of the ways they do that is by paying them a good hourly wage, a living wage, let’s say, right? So when they have to keep bumping it up, we have to realize and look at out mud and says it right here, as long as the Costco hot dog is still $1.50.

And again, I have to stress, if you’ve never seen, I don’t remember what the documentary is called, but it is specifically about the company’s struggle to keep that hot dog at $1.50, where they bought up all the other companies involved, the bun company stuff. And even then, let me just ask you this, type three, if you loved eating the Costco hot dog with the onions and the sauerkraut, those are completely gone. COVID was an excellent excuse for reason that many companies decided to pull back on what they offer. They stopped offering certain pizzas. They stopped offering the onions and the sauerkraut.

And quite frankly, you don’t get a good garlic burpee dog at Costco without the onions and the sauerkraut. Just ask Mrs. Ninja. She absolutely hates it when I eat those things. But my point being is it was a great reason for companies to pull back. All right. So now we see they’re raising their rates and we see on the same day from a different media outlet, it’s going to be because they’re giving their employees more money. I don’t blame them. They need to be able to keep business going as usual. However, these costs come down to us.

They trickle down to us. Says here, Costco has long been one of the highest paying employers in retail, a reputation on track to continue as hourly workers in the US, Puerto Rico and Canada are scheduled for raises later this month. In a memo to employees on Monday obtained by Business Insider, CEO Ron Vatras said pay for service assistants, service clerks and meat cutters at both ends of the wage scale will increase by $1 per hour. That brings the starting wage for those roles to $19.50 per hour, which is a gain of 5.4% for the lowest earners.

Says the CEO says that the raises will take effect July 22 and are part of the company’s efforts to ensure our hourly wages remain highly competitive in the industry. The median Costco employee made $50,202 in wages and benefits last year, better than those at Walmart who earned $27,000 and Target who earned $25,000. So if you’re working in retail, Costco is almost double its competition. The company did not respond to Business Insider’s request for comment ahead of the publication, but sources told Business Insider the raise applies to nearly all hourly employees with top-end clerks set to earn $30.90 per hour.

The raise follows several increases in recent years, including a $0.50 hike in March. So you see that Costco is really aggressively raising its salary as much as it can and still being able to make a profit. Sometimes, like in the beginning story when we started this, they have to be able to raise their prices for you and I. Right now, that is going to be in the form today, very soon, of our annual membership fees going up. And then what’s next? Well, what they will do is slowly but surely, one penny at a time, 10 cents at a time, raise the prices of their food and their other items that they sell.

They’re going to do everything they can to stay in business, but this is one of the great ways that inflation hits us all. And it’s a lag effect, it takes time. But when the company sees its bottom line getting affected, it has to raise prices. I hope you got something out of this. Thank you so much for watching. We’ve got two days left of the Mortgage Master Course, 80% off, $199. Link down below if you want to check it out. If you want to get ready for all this inflation, that’s going to completely destroy the real estate market.

You want to be ready to take advantage of it? There you go. Hope you got something out of this. The economic ninja is out. [tr:trw].

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