Why would a company charge you to shop there, raise the price of some of the things you buy, and then make it easier than ever to shop from your couch?
It sounds like the beginning of a bad retail story. Unless the retailer has discovered something most companies never figure out: maybe the customer is not really buying the product. Maybe the customer is buying the right to keep coming back.
That is Costco.
And the latest Costco news makes a lot more sense once you stop thinking of Costco as a giant store and start thinking of it as something closer to a subscription business with pallets.
Costco has spent decades building an unusual machine. You pay before you shop, Costco keeps merchandise margins relatively low, and the company tries to make the membership valuable enough that you renew it year after year.
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Now there is another layer.
You do not always have to drive to the warehouse anymore. Costco has expanded same-day delivery through major platforms including DoorDash and Uber Eats, while Instacart continues to power Costco's own same-day service in qualifying markets.
DoorDash now offers Costco from U.S. warehouses nationwide, while Uber Eats has expanded Costco delivery to 47 states and nearly 600 locations.
At the same time, Costco customers are seeing some very different price signals. One particularly eye-catching example is Kirkland Signature motor oil. The Associated Press reported that a two-pack of five-quart containers was selling for about $58, compared with roughly $30 previously, while Costco also imposed purchase limits.
So what exactly is happening at Costco?
Is Costco becoming more expensive? Is Costco becoming another delivery retailer? Is the Costco membership fee still worth it?
The answer is more interesting than any one of those questions.