Is This Cheap Costco Favorite at Risk?

It's a much-loved product shoppers don't want to lose.

For many shoppers, Costco is known as a place to load up on groceries and household staple items in bulk and for cheap. But some consumers turn to Costco for prepared food, too.

Normally, takeout and prepared meals can be very expensive. But Costco is famous for one prepared item that comes at a very attractive price point -- its $4.99 rotisserie chicken.

But now, that delicacy may be on the chopping block, at least at its current price point. And that's a concern for consumers who rely on Costco's chickens as a dinnertime staple.

Why Costco's rotisserie chicken deal is at risk

Three years ago, Costco spent $450 million on a poultry processing plant in Nebraska to produce millions of its signature rotisserie chickens. But now, Costco is facing a lawsuit from two shareholders who claim that the company violated animal welfare laws.

Specifically, the claim states that Costco mistreats its chickens and has gone to unethical lengths to produce rotisserie chickens on the cheap. And this isn't the first time Costco's treatment of chickens has been called into question.

In 2021, Mercy for Animals filmed a video showing injured chickens in a crowded Costco farm facility. In response to that, Costco defended its treatment of the animals, though it hasn't immediately responded to the aforementioned lawsuit.

Of course, the last thing Costco wants is bad press. And so it may decide to make changes in an effort to avoid backlash.

That doesn't necessarily mean the warehouse club giant won't continue to sell rotisserie chickens. But it may mean Costco is forced to raise its price on that item -- something it hasn't done in over a decade.

Should consumers be worried?

These days, groceries across the board are costing more due to inflation. And many common Costco items have already gone up in price.

If Costco has to raise the price of its rotisserie chicken, consumers can hope and expect that the price hikes at hand won't be drastic. After all, rotisserie chicken is a big seller for Costco, so the company will need to be careful to avoid losing out on sales.

Furthermore, even if Costco has to make changes to the way it treats its chickens, that won't necessarily lead to a higher price tag. Costco has long prided itself on being a source of low-cost essentials, and the fact that it hasn't raised the price of its $1.50 hot dog and soda combo for decades means it's clearly committed to upholding some of its most competitive price points. Still, consumers should brace for higher chicken costs out of Costco, just in case -- even if any increase that comes down the pike isn't enough to break the bank.

Will Costco raise membership fees?

Costco may be forced to increase the cost of its rotisserie chicken. But so far, the company doesn't have firm plans to raise membership fees.

That could change, though, if Costco incurs added costs in the course of delivering products for members. In fact, what may happen is that instead of raising the price of fan favorites like rotisserie chicken, Costco may just raise its membership fees.

Consumers may not be happy to see that larger charge on their credit cards. But seeing as how so many people rely on Costco for low-cost products, a modest fee hike is unlikely to lead to a mass cancellation of memberships.