Costco Is Opening Even More New Stores to Keep Its Club Members Happy. Time to Buy the Stock?
Membership fees account for just over half of Costco's (NASDAQ: COST) operating income. This is why keeping dues-paying members happy is vitally important to the business. But that's left the company in a quandary driven largely by its own success. Here's why this retail giant has no choice but to keep opening new stores.
Costco's customers pay a yearly fee to shop at its stores. That dramatically changes the dynamics of the relationship between the retailer and its customers. And given that so much of the company's operating income comes from membership fees, Costco has to make sure it keeps customers as happy as possible. To that end, it had a lofty 90% global membership renewal rate in fiscal 2023.
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Source Fool.com
