Costco leverages membership fees for multi-billion dollar revenue and member benefits

Costco utilizes a membership-based business model that generates significant recurring revenue through annual club fees. The company reported over 74 million paid household memberships and more than 135 million total cardholders worldwide. In a recent quarter, membership fees contributed over $4 billion to the company's revenue, driven by high renewal rates.

Beyond warehouse access, Costco memberships provide various external benefits, including discounts on car rentals. Partnerships exist with four major rental companies: Avis, Alamo, Budget, and Enterprise. These deals often include reduced rates, free upgrades, or waived additional driver fees, depending on the specific provider and geographic location.