Gold Prices Surge, Costco’s Precious Metals Sales Hit $200M Monthly
UPDATE: Gold prices have just skyrocketed to a new record high of over $3,600 per ounce, triggering a surge in demand at Costco. The wholesale giant is now selling more than $200 million in precious metals each month, marking a pivotal moment for its e-commerce business.
As of today, the soaring value of gold is driving strong online sales at Costco, where precious metals have become top sellers. Customers are eager to invest in gold bars and coins, leading to rapid sellouts within hours of their release. This trend is confirmed by posts on the CostcoPM subreddit, highlighting how quickly inventory moves when the spot price of gold rises faster than retail prices.
Costco’s former CFO, Richard Galanti, previously noted that the retailer’s low markup on gold and silver appeals to both collectors and investors. “It’s like a gateway drug to gold investing,” one enthusiast remarked, underscoring the emotional engagement of customers drawn to the precious metal market.
The wholesale club is leveraging this demand to bolster its e-commerce growth. According to analysts, Costco’s digital sales surged by 14.8% in the third quarter compared to the same period last year, building on a stunning 20.7% growth rate from the previous year. Costco has not disclosed specific sales figures for its precious metals, but the category is recognized as a key driver of online performance.
The strategy behind selling gold is straightforward: Costco purchases batches of gold and sells every ounce directly to its members. This approach allows the company to route hundreds of millions of dollars through Costco.com, showcasing impressive e-commerce growth with minimal risk and capital investment.
With the buzz surrounding gold sales, Costco is also attracting new memberships. For potential buyers, the $65 membership fee becomes trivial when considering a $3,600 purchase of gold bullion.
Costco is expected to provide more insights into its precious metals sales during its full-year earnings report on September 25. As gold continues to climb, the impact on Costco’s e-commerce strategy and overall sales could be significant.
Stay tuned for further updates as the situation develops.
