'Lightning just struck me,' Richard Galanti jokes when asked about the revered readymade hotdogs
Grocery prices may bite, but $5 is still goes a long way at the Costco food court.
The company’s storied hotdog-soda combo will remain $1.50 — the same cost it has been since 1985 — Richard Galanti, the company’s chief financial officer, assured investors last week.
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Galanti was asked which part of the retailer would help offset the cost of the fabled frankfurter during a fourth-quarter earnings call.
“Lightning just struck me,” he joked, offering a tacit acknowledgement of the $1.50 combo’s exalted status.
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“We really don’t look at it that way,” Galanti added, noting that the travel and gas side of the business allowed it to be “more aggressive in other areas.”
“Or, as you mentioned, hold the price on the hot dog and the soda a little longer — forever,” he said.
In May, when inflation was speeding up, another Costco executive declared that the price of the hotdog combo would remain the same. At the time, the ‘dogs should’ve cost around US$4.11, according to Marketwatch. However, the $1.50 price tag has become a part of the brand’s character and history.
In 2018, CEO Craig Jelinek spoke about the dogs and recalled bringing up the prospect of raising its price in 2009 to co-founder Jim Sinegal.
“I came to (Sinegal) once and I said, ‘Jim, we can’t sell this hot dog for a buck fifty. We are losing our rear ends.’ And he said, ‘If you raise the effing hot dog, I will kill you. Figure it out,'” Jelinek said.
“What we figured out, we could do is build our own hot dog-manufacturing plant (in Los Angeles) and make our own Kirkland Signature hot dogs. Now we are doing so much hot dog business that we’ve opened up another plant in Chicago,” Jelinek said.
“By having the discipline to say, ‘You are not going to be able to raise your price. You have to figure it out,’ we took it over and started manufacturing our hot dogs. We keep it at $1.50 and make enough money to get a fair return.”
Other items at the food court have increased in price, however, including a cup of soda, which costs 0.89 cents in Canada, as confirmed by a location in Toronto.