Costco has gone to great lengths to hold the price of the combo at $1.50 for 35 years.
When Costco president W. Craig Jelinek once complained to Costco co-founder and former CEO Jim Sinegal that their monolithic warehouse business was losing money on their famously cheap $1.50 hot dog and soda package, Sinegal listened, nodded, and then did his best to make his take on the situation perfectly clear.
"If you raise [the price of] the effing hot dog, I will kill you," Sinegal said. "Figure it out."
The hot dog combo is similar to a loss leader, but rather than literally drawing customers into the store for the bargain, the cheap hot dog is a goodwill amenity intended to leave Costco shoppers with a good feeling about their visit to the popular big-box store.