One day I walked into my local supermarket and bought five yogurt cups, a loaf of bread, a box of strawberries, and a gallon of milk.
Now, I’m probably not the most skilled person when it comes to mental arithmetic. But according to my calculations, the total of these items should not exceed $15. So when the cashier told me my total was $21, I asked her to make sure I didn’t accidentally double-scan something.
No.
It turns out food is ridiculously expensive these days. If you run out of staples at the wrong time, you could end up spending a fortune just to restock your pantry or refrigerator.
It’s for this reason that shoppers are increasingly turning to discount stores and grocery stores.
Walmart and Dollar Tree, for example, have seen an increase in high-income shoppers.
At a time when money is tight for many, companies like Costco need to be on high alert — especially as competitors plan to expand their stores.
Data from the U.S. Bureau of Labor Statistics show that in December 2025, U.S. food inflation increased by 0.7% month-on-month, the largest increase since the end of 2022. The overall food inflation for the year was 3.1%. Shutterstock · Shutterstock
Aldi recently announced plans to open more than 180 new stores by the end of the year. The move follows a major expansion in 2025.
The company aims to have 2,800 stores by the end of 2026 and 3,200 stores by the end of 2028.
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Aldi is specifically targeting the following markets:
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Portland, Maine
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Denver
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colorado springs
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Phoenix
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las vegas
Aldi is also committed to continuing its southeastern expansion.
“One in three U.S. households shopped at ALDI in the past year*, and through 2026, we’re focused on making it easier for customers to shop on our shelves first,” said Atty McGrath, ALDI U.S. CEO. “That means bringing ALDI to more communities, upgrading our website and planning more distribution centers to ensure our shelves are stocked with products shoppers love.”
Aldi and Costco have some key similarities. Both stores emphasize savings and value, and both rely on private label products to keep costs down for customers.
More than 90% of Aldi’s inventory consists of store-exclusive brands, which offer significant savings compared to national brands. Costco, meanwhile, often relies on its Kirkland Signature brand to offer high-quality products at lower prices than national brands.
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But one major difference between Aldi and Costco is that shoppers must pay an annual fee to gain access to Costco’s warehouse club. At a time when so many people are struggling financially, consumers may be less willing to shell out for these expenses.
Although Costco’s membership renewal rate in the U.S. and Canada was 92.2% in the first quarter of 2026 (as the company reported on its last earnings call), its membership renewal rate slowed slightly compared to the previous quarter. As consumers find themselves increasingly squeezed, they may be more inclined to turn to stores like Aldi to stretch their wages further.
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Compared with 2024, the average American household will spend $310 more on groceries in 2025, a year-over-year increase of 4%.
Source: U.S. Congressional Joint Economic Committee -
In December 2025, grocery prices nationwide increased by 2.4% year-on-year.
Source: Consumer Price Index -
In December 2025, grocery prices in the Western United States rose 1.1%, the largest monthly increase since 2022.
Source: Axios
All told, Aldi’s increased presence in new markets could take business away from Costco in a meaningful way.
Let’s remember that consumers may have more issues than just Costco membership fees. Many people also cannot afford to spend bulk purchases of groceries and household necessities. At Aldi, they don’t have to.
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At the same time, Aldi’s aggressive expansion plans may inspire Costco to think more creatively about how to retain and attract members. For those who continue to renew their memberships, this may lead to a better shopping experience.
Maurie Backman owns shares of Costco.
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This article was originally published by TheStreet on January 17, 2026, and first appeared in the Retail section. Click here to add TheStreet as your preferred source.
