- Several precious metal listings on Costco’s website have had transaction limits tightened this year.
- Even with earlier restrictions, the company said its inventory sold out “within a few hours.”
- Gold prices have reached record highs, and Costco has been a popular source for new collectors.
Sometimes things are a little too popular.
That certainly appears to be the case for Costco’s gold bars. The wholesale club has been gradually tightening (and clarifying) the transaction limits on some of its precious metals products.
Where shoppers on Costco.com could originally purchase two one-ounce gold bars per transaction, they can now buy just one at a time.
And last year, Business Insider visited a warehouse in Wisconsin where shoppers could bring home a stack of five one-ounce bars.
Jumbo 100-gram bars are also now limited to one online, down from five a year ago.
The language on the product listing pages also better clarifies that “per day” in fact means within a 24-hour period — a distinction that previously had some social media users complaining about canceled orders.
Costco often uses item quantity limits for products where it anticipates strong demand for a sharp deal. An analysis of Costco’s pricing strategy found the company sells gold for a scant 0.8% to 2.4% markup on average over the metal’s spot price.
And even with earlier restrictions in place, the company said its inventory sold out “within a few hours.”
The company did not immediately respond to Business a request for comment from Business Insider about the reason behind the tightened restrictions.
Beyond the price of the precious metal, which topped $3,400 per ounce last week, gold’s popularity has surged at Costco, where novice collectors are drawn to the club’s ironclad reputation for trustworthiness. One even characterized the club as a “gateway drug” to gold investing.
Some commenters welcomed the increased restrictions in discussion threads on the CostcoPM (precious metals) forum on Reddit.
“Good, they should limit to 1. Screw the flippers and bots,” one Reddit user said. “It was getting near impossible to buy lately with the bots buying up all the inventory within a few minutes.”
Other users pointed out that gold sales aren’t about making a profit for Costco, they’re about attracting and rewarding members, so it makes sense to allow more members to have a real chance at buying bullion.
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