Reference
Peterson, Kim. (2014). 12 Things about Costco that may surprise you. Retrieved from: http://www.cbsnews.com/media/12-things-about-costco-that-may-surprise-you/
Metrics Management recommends that Power Metrics (PMT) Tools integrates the Keiretsu network as their supply chain strategy. The versatility of the Keiretsu network is the primary reason for the suggestion of its integration. Keiretsu a unique form of corporate organization; the word Keiretsu itself, “…a Japanese term describing a loose conglomeration of firms sharing one or more common denominators. The companies don’t necessarily need to own equity in each other” (Investopedia, np). In simpler terms a Keiretsu network allows a company to use a hybrid of purchasing avenues from few suppliers to shrink the purchasing process. It allows the company to respond relatively quickly to customer’s needs. “Each major keiretsu is capable of controlling nearly every aspect of the economic chain in a variety of industrial, resources and service sectors.…
Costco markets itself primarily to large businesses and families. Costco avoids selling multiple brands and varieties, except when it is a variety of household goods and brands, primarily by their signature label, Kirkland brand.…
2. All three warehouse club rivals have some similarities and some differences. They all maintained the goal of selling top-quality merchandise at low prices. They have a few differences when it comes to pricing, merchandising, advertising and growth. Costco stands out because their markups and prices were only fractionally above the level needed to cover expenses and operating costs. They also use a treasure hunt method for merchandising that is unique to them. Much money is not spent of advertising for Costco or Sams like for BJ’s, and their growth strategy is to build more warehouses and build membership base. Costco appears to have the best strategy, it just seems to be more thought out and planned. BJ’s has the weaker strategy, if you base it off of numbers. If they did not have such successful competitors then their strategy could work well.…
Costco members know that the warehouse store has consistently lower prices when compared to traditional grocery stores. While other stores may have occasionally lower prices on their loss leaders, Costco has permanently round off its margins to ensure that members can be satisfied paying for a membership.…
However, Costco has managed to stand up and acquired a better market share. Costco has managed to establish a good relationship with their suppliers in order to provide better prices. They have a low-cost strategy that has been successful among the years. In addition, they also have a good strategy to recruit future clients. You always see them trying to engage future customers in activities and offering them coupons so that they get them to enroll in a membership. Costco focuses on the ability of increasing the membership base and to employ well executed merchandising techniques to induce members to shop more often. One of the advantages that BJ’s has that could be a weak point on the strategies of the other two, is that it is the only major warehouse operator to accept manufacture’s coupons, which provided added value for members. I believe that Costco is the one that has been able to achieve all the requirements to succeed. Better prices, large member base, good selection of products and a well trained work…
As we look at our current economical status, we see how the global financial market is in turbulence due to changes in demographics. To subdue these changes Costco has constantly tried to pull in and retain customers. This allows them to keep a strong position in market share and acquiring profits. Costco is in the membership wholesale industry that provides merchandize at a much lower price than others. Although Costco is one of the biggest companies in the USA, there are many strengths and weaknesses in their strategy. Taken that Costco has many competitors, it must continue to respond to industry pressure through innovation. Considering the many accomplishments of Costco, there are many things they can improve on. Increasing profitability…
Costco has developed a brand named Kirkland. The Kirkland brand has the Costco expectation to be equivalent or better than national brands. A continual product improvement is the exact objective for the maximum competing goal. Product quality and price comparison is continuously revisited by the internal Costco research team. Sam’s club is a division from the Wal-Mart Corporation. Although Sam’s and Costco have a close race, there is an outstanding difference when considering the research that goes into product expectations and supplier preference. Costco is very similar to Sam’s but in resent comparison Costco has beat out many companies in the same bulk market. Costco and Sam’s have excellent programs for their employees and team effort climate has both companies at an outstanding stance to overall organizational…
Dell Inc. is an excellent example of Product Differentiation, as customers are able to customize the products to their personal needs. Customers can order over the phone or through the internet web site (Laudon & Laudon, 2010, pg. 97). Consumers can create an account and log onto the web site, search for the product of interest and then select and customize the product such as a personal computer or printer (Dell,…
Costco is known for only carrying products of superior quality; on the other hand, Wal-Mart is known for carrying cheap products. They must try not to relate Sam’s Club with Wal-Mart, as Sam’s Club needs to have more of a Costco reputation than Wal-Mart. If it can be established in the consumer eye that Sam’s Club is superior to Costco in price and quality, there is potential to improve their future development.…
Costco was founded in 1983, went public in 1985 and in 1993 merged with Price Club, a successful membership warehouse. With over 400 membership warehouse stores serving more than 38 million members, Costco is now the largest wholesale club operator in the US.…
Costco Wholesale Corp is a big box retailer selling mass quantities of items at Wholesale prices. They are a very consistent company, with constant growth and profitability. They show no major signs of corrupt business practices, and for that reason have been known as one of the best businesses. They currently operate with 174000 employees, which are paid well and have low employee turnover. They do their business in 608 warehouses internationally, and continue to grow. Costco is a highly profitable, well functioning business. Costco only marks up their item’s selling price 15% from original cost, which gives them a low profit margin of 1.7%. With such a low margin, it brings into question how Costco is able to make so much money. There are a variety of ways that Costco makes money: Membership Fees, Rapid Inventory Turnover, Affordability, private label brands, premium products and effective use of square footage.…
Costco has a wealth of employee benefits that are geared toward the well-being of its employees. Along with the typical benefits that help manage the stress of health and retirement, Costco also has other benefits that are useful for employees. Employees that are experiencing financial stressors have at their disposal a program that can help them get back a repossessed car. This is actually quite brilliant because it ensures the employee has a way to get to…
In 1983, Costco Wholesale Corporation, the fourth-largest retailer in the United States, was founded by former Price Club executive, Jim Sinegal, and lawyer Jeffrey Brotman. Costco focuses on selling products at low prices in bulk packaging and focuses mostly to large families and small businesses. They sell products like flat-screen TVs, gallon jugs of mayonnaise, and coffins. Costco operates 556 stores worldwide: 405 in the United States, 77 in Canada, 31 in Mexico, 21 in the United Kingdom, 9 in Japan, 7 in South Korea, 6 in Taiwan, and 1 in Australia. Costco employs 140,000 employees and accumulates $70 billion in annual sales. It became the first company to rise from zero to $3 billion in sales in less than six years, and reached the $1 billion mark in 3 years. Costco saves, enabling them to keep costs low, by not spending money on marketing, only carrying one brand, unless a house brand is offered, of a product, and not stocking bags or packaging materials. Costco has a policy of not marking their products for more than 15% of the supplier price.…
As stated earlier, Costco has a high employee retention rate, in part because the employees feel empowered. Costco’s employee pay is among the highest among discount retailers and your company offers one of the best health insurance plans available. This has led to a workforce that is productive and loyal. Also, it is in contrast to the old workplace where jobs were less stable and employees had no say-so pertaining to company functions.…
Costco lists “take care of our employees” in their mission statement; which shows they view their employees as an asset. Costco is one of the few corporations around who actually do care about their employees and show them appreciation; not just for the cameras. Costco has long term, happy and loyal employees because they feel as if they are part of the organization and helping grow into a bright and profitable future.…