Grocery retailers are dealing with big price declines in products like eggs, meat and dairy. Lower prices can mean lower sales.
Costco, which sells a lot of groceries, isn't immune. But it's got a not-so-secret weapon: its membership fee, which starts at $55 a year.
“About 75 percent of its operating income comes from the membership fee,” said Piper Jaffray analyst Sean Naughton.
According to Naughton, in the U.S. and Canada, Costco's membership renewal rates are north of 90 percent.
“I consider that to be a very good number,” he said.