Would you like a $2,000 gold bar at Costco with your $4.99 rotisserie chicken?
Yes, Costco sells more than just toilet paper, office supplies and food items, and the company is quite effective at it. A 24-karat 1 oz. Gold Bar PAMP Suisse Lady Fortuna Veriscan was listed as sold out on Costco’s site this week and bars usually sell out hours after being posted on Costco’s website, according to chief financial officer Richard Galanti.
The wholesale retailer began selling gold online in September and 1 oz. gold bars on Friday were going for $2,069.99, with a limit of two bars per Costco membership. According to the Costco website, the non-refundable gold comes “in a sealed black assay card” and is “individually stamped with a unique serial number.”
The company sold more than $100 million worth of gold bars last quarter, Galanti told analysts during the company’s earnings call on Thursday.
Costco’s success in selling gold comes as the company continues to report strong profits from the pandemic in 2020, when customers rushed to stores to load up on groceries and household staples.
Millions of first-time customers signed up for club memberships during the pandemic and have held onto them, pushing Costco’s member rolls to all-time highs. Shares of Costco (COST) have surged over 45% this year.
Gold prices, meanwhile, hit an all-time high earlier this month, buoyed by growing expectations of interest rate cuts among investors, a weaker dollar and geopolitical tensions. When interest rates are low, falling or — as in this case — expected to fall, demand for Treasuries ebbs, and gold, which doesn’t pay out any interest, becomes relatively more attractive.
Over a longer timeframe, gold has benefited from another factor: a deep sense of global unease. Investors typically see the metal as a safe haven since it is a tangible, scarce asset that, in theory, holds its value. However, the tricky part for investors is selling back the physical gold, which can be risky and expensive.
CNN’s Anna Cooban contributed to this report.
