Startup delivers Costco hot dogs at huge markup
Archived — this story has rotated out of today’s deck. It is kept here in full.
The gist
No Tip sells Costco's $1.50 hot dog and drink combo for $18, a 1,100% markup.
The founder says it's a catering play aimed at offices, not solo lunches.
Background
No Tip is a new Southern California startup, started in Venice, that delivers Costco food court items and says it is not affiliated with Costco. Its founder, Jack Chen, is a longtime software engineer who says the idea came when he craved Costco pizza but couldn't easily get one. Costco's $1.50 hot dog and drink combo has stayed unchanged for more than 40 years, and the retailer's current CFO and CEO Ron Vachris have both pledged to keep the price.
How it unfolded
- recentlyNo Tip, described as two months into business, says it can serve all of Southern California through 66 fulfillment locations, depending on the orderer's location.
- Nov 9, 2026Reports detail No Tip's markups: the $1.50 hot dog and drink combo at $18 (a 1,100% markup), the $9.95 whole pizza at $30 and the $7.99 rotisserie chicken chef salad at $28.
- Nov 9, 2026The Independent says it contacted Costco for comment.
Key terms
- markup
- The difference between the selling price of a good or service and its marginal cost.
- catering
- The business of providing food and beverages at venues such as events, offices, or private residences.
- CFO
- A senior executive responsible for managing a company's finances, including financial planning, risk management, and reporting.
Source: Wikipedia
Who’s saying what
- Founder
- Jack Chen says the prices make sense because No Tip is a catering program for offices, not a way for one person to order lunch, and that prices are all-inclusive with no fees or tips and refunds for late orders.
- Founder
- Chen says he used early orders as a marketplace test, raising prices to what customers' budgets were: "It was just basic math."