Costco’s hot dog combo has cost $1.50 for over 40 years, and a California delivery startup is charging $18 for one

A California delivery startup called No Tip is charging $18 for a Costco food court hot dog and soda combo. Costco itself sells the same combo for $1.50, a price that has held steady for over 40 years, as reported by SFGate.

BroBible reports that works out to an 1,100% markup. Costco does have an official partnership with Instacart for same-day deliveries, and members can also order other items through platforms like DoorDash and Uber Eats. However, those services typically don’t let customers order from the food court.

No Tip mainly focuses on large orders, such as business lunches, birthday parties, and big family gatherings. Customers can choose to have Costco provide the food for these events, and anyone who wants the hot dog combo delivered pays $18 instead of $1.50.

The hot dog isn’t the only thing marked up

Other items on No Tip’s menu carry significant markups too, though nowhere near as steep. A pepperoni pizza costs $30 instead of $9.95, a 202% increase. A rotisserie chicken salad costs $28 instead of $7.99, a 250% jump.

Jack Chen, who runs No Tip and currently serves customers in Southern California, acknowledged that the pricing might shock the average person. He said No Tip benefits from taking orders in an area full of wealthy businesses, where many people won’t hesitate when they’re paying with “the company’s money.”

The combo has a long history at Costco. The company first opened in Seattle in September 1983 and added a second location in Portland, Oregon, a month later. In 1984, the manager of the Portland store let a vendor set up a hot dog cart offering a hot dog and a soda for $1.50, and the price hasn’t changed since.

Costco co-founder Jim Sinegal, who served as CEO until 2011, once responded to a suggestion to raise the price by saying, “If you raise the effing hot dog, I will kill you. Figure it out.” Former CEO Craig Jelinek shared the story at a business event near Seattle in 2018, per Fortune.

Costco later began producing its own Kirkland Signature hot dogs at a plant near Los Angeles, which made the $1.50 price profitable. The company now sells nearly 200 million hot dogs a year from its food courts. Earlier this year, it also cut prices on Kirkland items after members complained. Former CFO Richard Galanti called the hot dog price “sacrosanct,” and current CFO Gary Millerchip has reaffirmed that the combo will stay at $1.50.