Bellevue, Washington – Costco’s iconic $1.50 hot dogs have been a beloved go-to meal for shoppers at the retailer’s 602 locations nationwide. Since its debut in 1985, this inexpensive all-beef hot dog combo has remained a favorite among customers. The story behind how Costco has managed to keep the price of this popular meal so low dates back to the sentimental roots of the company.
The late chairman of Costco, Jeffrey Brotman, shared that his first business venture involved operating a hot dog cart in Seattle with his brother in the late 1970s. When Brotman and CEO Jim Sinegal founded Costco in 1983, they made a commitment to never increase the price of the hot dog and soda combo despite inflation pushing costs higher over the years.
In a 2018 interview, former CEO Craig Jelinek recounted a moment when concerns were raised about the sustainability of the $1.50 price tag for the hot dog combo. However, Sinegal staunchly defended the price, challenging his team to find a solution. Jelinek took on the challenge by establishing hot dog manufacturing plants in Los Angeles and Chicago, ensuring that Costco wasn’t reliant on costly third-party suppliers.
Despite doubts about the longevity of the $1.50 price tag, Costco leaders have remained firm in their commitment to maintaining the affordable price. During shareholder meetings, executives like CFO Richard Galanti emphasized that the beloved combo meal was here to stay, even as market dynamics shifted.
As Jelinek retired and Galanti stepped down, questions arose about whether Costco would uphold its founders’ pledge. Yet, the company has shown no signs of wavering in its dedication to offering the $1.50 hot dog and soda combo to its loyal customers. A recent viral story of an Ohio resident surviving on Costco’s affordable meal for a week highlighted the enduring appeal of this budget-friendly option in the face of rising food costs.