Costco Wholesale, the warehouse club phenomenon, is implementing a series of strategic operational moves and enlargements aimed particularly to enhance members’ value proposition.
New Executive Member Shopping Hours
Among the recent innovations is adding new shopping hours for United States-based Executive Members. The initiative was launched formally on a Monday, which had the advantage of setting aside a special time slot for the higher-end membership.
Members in the $130-per-year membership tier have exclusive early access to Costco stores on weekdays and Sundays between 9 and 10 a.m. But Saturday operations welcome Executive Members between 9 and 9:30 a.m.
The head start benefits Executive Members with entry before Gold Star and Business Members, who gain access on weekdays and Sundays at 10 a.m. and Saturdays at 9:30 a.m.
Extended Department Access
The additional hour is also applied to the auxiliary sections. Costco’s optical centers, food courts, and pharmacies are examples of such hours, although pharmacies do not work on Sundays.
The company first introduced the new shopping benefit at the start of this month through social media and direct email to Executive Members.
Gas Station Hours Extension
Another recent initiative has been extending the operating hours at North American Costco fuel stations. This is providing further convenience to members, particularly commuters.
CEO Ron Vachris added that these improvements establish all-time-week gas sales records. He further added, “The intersection of additional hours on the gas station, fresh store openings on the gas station, and reduced prices at the pump have caused us to record two of our best-gallon weeks ever in the U.S. over the last month.
Checkout Technology Improvements
Costco is spending money on technology to speed through the checkout. Mr. Vachris invited investors and analysts to look for pilot tests on the horizon, including testing of a “Scan & Go” self-checkout application in-house. Those technologies are meant to hurry members’ shopping
Executive Membership: A Revenue Powerhouse
Costco’s 37.6 million Executive Members are a core part of its business model, propelling a significant percentage of total revenue.
Membership fees alone generated close to $3.6 billion for the first nine months of the current year. Last year it was $4.8 billion. This stable source of revenue indicates the importance of building Executive Member benefits.
Market Confidence in Membership Strategy
BMO Capital Markets maintained its Outperform rating for Costco at a price target of $1,175 by June 2025. The firm pointed to the Executive Membership segment’s strength, with 47% of members but representing 73% of sales.
Strategic actions like a $10 per month credit on Instacart and head-start access windows are investments in member retention and greater switching costs more difficult for customers to switch to other stores than Instacart.
Strong Sales Performance
Costco’s May 2025 sales were 6.8% higher at $20.97 billion, with e-commerce sales rising 11.6%. Net sales, over more than 39 weeks, rose 8% at $201.02 billion, a testament to the success of its membership model.
While there is seen by some analysts to be fear in U.S. non-food sales, others like BMO see drivers for growth elsewhere, i.e., global markets. Global revenue is boosted from 40% in 2020 to 43% today.
Free-Standing Gas Stations as a New Growth Area
Costco is testing a free-standing gas station concept in Mission Viejo, California. The effort tries to provide discounted fuel without the need for being adjacent to a warehouse complex.
The spring 2026 opening store will feature a 17,185-square-foot canopy and 40 fueling pumps the biggest Costco fueling station so far. Membership will remain necessary in order to use the fuel.
The model might be employed to tap into untapped markets, particularly where there may not be support for complete warehouse operations. The well-being of Costco’s cash reserves $149 billion as of Q1 2025 provides the company with the financial muscle to experiment with such innovations.
Growth and Analyst Valuation Views
Despite a 31.5 P/E compared to 22.3 for S&P 500, BMO justifies Costco’s valuation on its dividend payout stability, velocity of inventory turnover, and cash flows.
Its $1,175 price target on BMO stock is premised on assumption like Executive Membership penetration to 50% in 2026, and e-commerce accounting for 10% to 15% of sales in three years.
Global Expansion Plans
Costco plans to open 30 new warehouses globally by 2027, Mexico and Japan being part of them. While shares closed at $985.14 on June 19, 30-analyst consensus is $1,024.03, indicating expectations of additional gains.
Even traditionally conservative companies like Mizuho acknowledge that strong global performance and member loyalty can balance out domestic slowdowns.
Spurring Loyalty With Convenience
Savings and convenience of Costco gas choices are included in member satisfaction. If the members purchase gas by means of the Costco credit card, 5% back on gas is earned.
Selling independent gas stations in the future, Costco will be eliminating the inconvenience of finding warehouse-based locations in the event of long roadtrips.
Mission Viejo Mayor Robert Ruesch is heavy trafficked, and retailing analyst Neil Saunders added that Costco gasoline is “very popular among members because the lower prices.”
OPIS data indicates a 53-cent-per-gallon California-Market average price difference.
Fuel Infrastructure and EV Investment
Costco also is expanding existing gas stations by having them remain open longer and more places. Some stations now open an hour earlier or close an hour later to capture commuter traffic, selling record gas volumes.
Aside from gasoline, Costco also has started installing electric vehicle charging stations at a select few locations to accommodate evolving consumer transportation needs.
The Mission Viejo warehouse, while large for a Costco, is minute in comparison with super-stations like Buc-ee’s, which boast 120 pumps. Still, the move is a strategic incursion into more competitive gas territory.
Membership, Convenience, and Expansion: Strategic Focus
Transformations in Costco’s business such as special shopping hours and all-night gas sales to new-tech pilot programs and foreign warehouse openings underscore a consistent focus on member value.
The ability of the retailer to take in revenue from loyal Executive Members while investing in physical and digital convenience positions it to manage competitive forces and changing consumer trends.
The Mission Viejo pilot, if successful, would set the stage for other stand-alone gas stations, enabling Costco to expand its presence without warehouse expansion.
Costco’s price, loyalty, and infrastructure combination sends a message of preparedness to capture market share by making membership more rewarding, more convenient, and harder to lose as the retail marketplace continues to become increasingly competitive.
