Have you ever really, truly had the full, be-all-end-all Costco experience if you've
never ordered one of the chain's iconic food court hot dogs?
Here's everything you need to know about the $1.50 snack.
The warehouse retailer built its cult-like following by selling high-quality products
at low prices, and perhaps the most quintessential example of that business model is Costco's
Kirkland Signature Hot Dogs.
You can buy the famous franks in huge packs in the meat section, or, as already mentioned,
famously grab one with a steamed bun and a soda at the food court for $1.50.
It's a price that's set in stone thanks to founder Jim Sinegal.
"At one point there's a story where the co-founder told the CEO to never change the price."
According to a report from Insider, that's a tame version of what Sinegal told CEO Craig
Jelinek.
Jelinek told the audience at a Chamber of Commerce luncheon that Sinegal's exact words
were -
"If you raise the effing hot dog, I will kill you.
Figure it out."
So what's the secret to the flavor and price of the famous Costco hotdogs?
Well, Costco makes the dogs themselves at their own Kirkland meat processing factories,
which keeps costs down and allows them to maintain taste and quality year after year.
While a lot of Costco's private-label products are made by other brands and packaged with
in-house labeling, Costco also maintains its own food manufacturing supply chain for products
that are bestsellers.
Even though it's a fun game for shoppers to guess which big company makes a certain product,
when it comes to the signature hot dog, it's a total in-house operation.
It's understandable that if you've never had a hot dog at Costco, you might not get what
all the hype is about.
But as any frank-lover knows, not all dogs are created equal.
The Kirkland dogs are made with 100% USDA-inspected beef and contain no fillers, byproducts, or
corn syrup.
The hot dogs in question are also comparatively huge, clocking in at almost four ounces each.
Plus, the hot dogs are bun-length, so you'll get a bite of meat with every bite of bread.
Indeed, Costco's hot dogs are so popular that according to Business Insider, the company
sold 151 million of them in 2019 alone — and that number only counts the hot dogs sold
in Costco food courts, not in retail packages at Costco warehouses.
That's $226.5 million in revenue just in hot dogs for a single year.
As previously mentioned, a lot of Costco's Kirkland products are made by other larger
companies, and for a long time, the company's hot dogs were made by Hebrew National, although
they were sold under their brand name.
As you may have already guessed, that's not the case anymore.
So what exactly changed, and how, and why?
According to Costco Connection, the company's in-house magazine, Hebrew National was the
go-to choice for Costco's food court hot dogs from the time the company started selling
them in 1984 until 2008.
However, as Costco grew, kosher meat suppliers decreased in number, and the price of Hebrew
National's products went up accordingly.
As a solution, the company then made the executive decision to make its own dogs in order to
keep costs down.
In order to do this in a cost-effective manner, Costco bought a meat processing factory in
California — and in short, the gamble looks like it paid off.
Costco now operates multiple meat processing facilities in the U.S., where in addition
to hot dogs, they make a number of other products, including raw and cooked hamburger patties,
meatballs, and other meat department favorites.
As this meat-related production and expansion would suggest, Costco's hot dogs have only
grown in popularity since the switch, along with a slew of loyal diehard fans.
As one fan on Reddit claimed -
"I'm now a hot dog snob because of them.
No Ball Park or Oscar Myer for me.
I want those Kirkland hot dogs."
Now that you know all about what goes into the famous franks, grab a jumbo pack for your
next backyard party and be a BBQ hero, or reward yourself and stop by the food court
on your next trip to the warehouse retailer for a taste — after all, they'll always
be $1.50.