Why Costco Will Probably Never Offer Pizza Delivery

Costco's food court is a big deal. Its menu is famously cheap and hot dogs haven't gone up in price since 1985 — a story told by Costco CEO Craig Jelinek involves co-founder Jim Sinegal angrily threatening him after he suggested raising prices on hot dogs. A hot dog and drink is still $1.50, a Costco chicken bake is still four dollars, and an 18-inch Costco pizza only sets you back $10 (or you can get a slice for $2). The catch is, you need a membership nowadays and you need to buy it in-store. No pizza deliveries.

What makes Costo so anti-delivery? The main reason seems to be that the massive, warehouse-sized retailer sells much more than fast food, and the retailer is open about the food court being a lure to bring customers into those warehouses. "It's still important to get people physically in stores," Jelinek said in 2020, during an interview with CNBC. "I still think brick-and-mortar is not going to go away. We want to continue to get people in the stores, and there's no better way to do it than a $1.50 hot dog and a rotisserie chicken (for $4.99)."

Those cheap pizzas are a useful way to get customers to buy more stuff at Costco. This strategy is known as a "loss leader:" sell a product for less than it's worth, in a way that spurs customers to spend more money elsewhere in the business. When it works, then despite losing some money at the beginning, you make more money in the long run.

Costco's food court — especially Costco's in-house hot dog and drink combo, but its pizza as well — is considered an extremely effective example. To reach the cheap food court, you have to pass shelves full of household goods you might decide to buy on your way there. Ordering pizza delivery is certainly easier for you, the customer, but it defeats the point of the pizza's cheap "loss leader" price.

The strategy seems to work out for the giant, members-only retailer. Costco is technically one of the United States' biggest pizza chains, and some stores report selling 600 pizzas in a day. Costco sells more hot dogs than every Major League Baseball stadium combined. This helped the company make over $6 billion last year, mostly from membership fees.

That said, if you're absolutely committed to getting Costco pizza delivered to your front door, there are ways. Instacart offers delivery from Costco and can save you money if you enter your Costco membership info. Now, most of the offerings are frozen pizzas that come from the aisles, not the food court. However, if you're willing to buy a few things in bulk for delivery (Instacart's delivery minimum is $10) then you can contact the Instacart shopper and include a hot food court pizza as an add-on to your order — if the shopper agrees to it. You can call that Costco location to place your pizza order beforehand. 

TaskRabbit also works as an alternative. The app lets you hire "Taskers" who can do shopping for you, and even if Costco won't deliver pizzas, your Tasker can easily pick up a pizza for you and include it with your delivery. You'd similarly pay for the pizza through the TaskRabbit app. Until Costco offers internal delivery services, may not happen anytime soon, this is the only way besides picking the pizza up yourself.