Costco Is Cooking Up a Batch of Post-Pandemic Free Food Samples

Costco is bring back free food samples in June. Despite lower foot traffic during the pandemic, the company beat earnings expectations.

Costco’s in-store experience is about to get a lot tastier. | Image: Justin Sullivan/Getty Images/AFP

  • Costco shoppers have a reason to be excited as the company is reviving its free food samples.
  • Costco relies on the in-store experience to drive foot traffic.
  • Despite eliminating free samples in March due to health concerns, Costco still managed to beat analyst expectations.

For shoppers who crave Costco’s (NASDAQ:COST) hotdogs, cheap food court finds, and free samples, there’s a reason to be excited. The membership-only retailer is bringing back free samples and reopening almost all of its food courts by the middle of next month, according to CFO Richard Galanti.

Costco Relies on Free Samples to Lure Shoppers

Costco will revive its free food offerings after suspending the legendary customer experience in March over health and safety concerns. But gone are the pre-pandemic days when shoppers can sample on an open tray.

Galanti says:

We’re going to start doing some things in mid June on a slow rollout basis in sampling. I can’t tell you any more but it’s – needless to say – not going to be where you go and just pick up an open sample with your fingers,

Galanti also said Costco plans to add previously-removed items back on the menu beginning in the third quarter.

The free food sample is so popular among Costco members that many consider the in-store experience a part of their shopping routine.

Costco shoppers look forward to the free samples. | Source: Twitter

Others can’t help but express their excitement when offered to taste some samples.

Some go to extreme lengths just to get more free food.

Doing a quick transformation for more free food. | Source: Twitter

Costco relies on foot traffic to drive sales as the retailer has been slow to expand on the e-commerce front.

Costco Sales Soar Despite Pandemic

While foot traffic dropped 2% in fiscal Q3, Costco reported revenue growth due to panic buying.

The company beat consensus estimates after reporting earnings per share of $1.89 with $37.3 billion in revenue. Analysts predicted that Costco would print earnings per share of $1.85 on sales of $36.55 billion.

On Thursday, Costco’s stock rose 1.2% to finish at $309.56. Shares of the giant retailer are up 5.5% year-to-date.

Disclaimer: The above should not be considered trading advice from The writer does not own any Costco shares.

Last modified: September 23, 2020 1:58 PM

Kiril Nikolaev: Kiril is a CFA Charterholder and financial professional with 6+ years of experience in financial writing, analysis, and product ownership. He has a bachelor's degree with a specialty in finance and lives in Canada. Kiril’s current focus is on finance and cryptocurrencies. He owns Bitcoin, Ethereum, and other cryptocurrencies. He holds investment positions in the coins but does not engage in short-term or day-trading. Get in touch with Kiril: Email, Follow on Twitter