Why Is Costco's Hot Dog Combo Still So Cheap? A Death Threat
Costco's CEO said the company's founder had some strong words regarding raising food court prices.
Killing someone for changing the price of a hot dog may sound like an overreaction. But what if the threat was for changing the price of the $1.50 Costco hot dog deal? That conflicted emotion you’re feeling is empathy waning.
In 1985, Costco first introduced its now legendary food court deal: a hot dog and soda for just $1.50. Part of what makes the offer so mythical is that, 35 years later, the price hasn't budged—despite the fact that the Bureau of Labor Statistics’ CPI Inflation Calculator suggests the price should be around $3.65 today. Keeping costs down hasn’t been easy: As MarketWatch explains, Costco had to stop using Hebrew National dogs and build a plant to produce its own Kirkland Signature wieners. Still, it’s apparently worth the effort as the wholesale chain moved 151 million of the combos last year according to the Puget Sound Business Journal.
Furthermore, for one man, locking in that low price was a matter of life and death. On Sunday, the Twitter user @weirdcities resurfaced a little-known tidbit about Costco’s dog deal that proceeded to go viral. “Absolutely losing my mind over this,” the tweet stated. The post then shared a quote from a story on Mental Floss, citing a 2018 article on the site 425 Business that pulled excerpts directly from a presentation by Costco President and CEO W. Craig Jelinek.
“I came to [Costco co-founder Jim Sinegal] once and I said, ‘Jim, we can’t sell this hot dog for a buck fifty. We are losing our rear ends,’” Jelinek was quoted as saying. He then shared Sinegal’s response: “He said, ‘If you raise the effing hot dog, I will kill you. Figure it out.’”
Just to hammer things home, a man worth over a $1 billion threatened to kill a man worth over $100 million over the price of a $1.50 hot dog. (That’s capitalism, I guess?) “That’s all I really needed,” Jelinek explained of his decision to keep the price of the deal the same—because when given the choice between your life or processed meat, you’re best to choose your life every single time.
Despite the fact that this story has apparently been in the ether for at least a couple of years, the tweet highlighting Sinegal’s humorous nod toward homocide was enough of a revelation that it’s racked up nearly half a million likes and over 90,000 retweets as of this writing. It turns out idle threats aren’t just good business; they’re good marketing, too!