Competitive Analysis SWOT analysis of Costco Wholesale Co. Costco Wholesale Corporation is the world’s largest membership warehouse club chain based on sales volume. Sales for the fiscal year ending September 30‚ 2008 were almost $71 billion (www.online.wsj.com). Costco was founded in Kirkland‚ Washington by James Sinegal and Jeffrey Brotman. Costco opened its first warehouse in Seattle‚ Washington‚ on September 15‚ 1983. Costco is headquartered in Issaquah‚ Washington (www.hoovers.com)
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Costco Wholesale in 2012: Mission‚ Business Model‚ and Strategy By: Courtney Cloud‚ Quinnton Anderson‚ and Ardis Christopher Purpose of this case • To analyze Costco’s business structure and what has made it successful in the industry. Costco Background • The first Costco started in 1983 in Seattle. • Costco was the first low-cost membership chain‚ based off of Price Club. • Jim Sinegal became the co-founder and CEO after being manager under Sol Price at Price Club. • Once Sam’s Club and BJ’s
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1. What is Costco’s business model? Is the company’s business model appealing? Why or why not? Costco’s business model was to generate high sales volumes and rapid inventory turnover by offering members low prices on a limited selection of nationally branded and selected private label products in a wide range of merchandise. Costco’s business model is built upon customer memberships‚ who join and renew annually. This directly monetizes customer loyalty as unsatisfied members may not renew and represents
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different levels of profitability. These five forces help managers analyze the industry to gain a better understanding and develop a more effective business strategy. In the discount retailing industry‚ it is important to consider the following when considering entry: Threat of New Entrants: Four major competitors‚ WalMart‚ Kmart‚ Target and Costco Wholesale dominate the discount retail industry. The threat of new entrants is low‚ as this small number of large firms has spent decades establishing their
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1 Case Study Assignment 2: Costco Wholesale 1. What is Costco’s business model? Is the company’s model appealing? Why or why not. Costco’s business model is to generate high sales volume and rapid inventory turnover by offering members very low prices on a limited selection of nationally branded and select private-label products in a wide range of merchandise categories. The company’s business model is appealing from an operational standpoint; in the pursuit of its goal of selling a high volume
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Competitive Advantage and Sustainability Analysis � INTRODUCTION Costco Wholesale opened its first store in Seattle‚ Washington in 1983. Founders Jeff Brotman and Jim Sinegal had a simple yet powerful idea: allow people to save on basic necessities and consumer staples while taking advantage of special offers on high-end luxury items and durable goods. With $71 billion in sales and more than $1 billion in net income for their latest fiscal year‚ Costco is the leading player in the warehouse club
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3.4 The Costco strategy in the wholesale price club. At the beginning of his creation Costco wholesale as his name indicates it only sales to wholesale business customers so to enter to its shops in the past you need to pay to have a special card to buy in their shops. This with the pass of the time was changing because they notice that they were losing potential retail customers‚ because they sell big size products and in big quantities and they realized that over the years in the USA the people
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Costco Wholesale Corporation entered the wholesale club industry in the early 1980s. The idea behind a wholesale club was to maximize profits by minimizing operational costs and maximizing inventory turnover ratio. The company experienced tremendous growth from 1997 up to 2001 and has caught the attention of its competitors. Costco Wholesale is one of the largest retailer stores in the market. The company has differentiated and positioned itself well in the market through its mission statement. The
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Costco Wholesale in 2012 Costco Wholesale in 2012 Problem Statement Costco exhibits several strategic weaknesses in comparison with its competitors. Analysis and Evaluation Since the inception of Costco in 1983‚ one of its drawbacks is‚ they have 4‚000 selections of merchandise compared to their competitors. In addition‚ customers can only purchase merchandises in bulk. Consumers who shop at Costco do not have the choice to pick up one single item‚ for instance a can of soup. Although
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Costco is a retail warehouse wholesale club that offers a wide variety of quality brand-name merchandise. The founders James Sinegal and Jeffrey Brotman opened the first warehouse in Seattle‚ Washington in 1983. Keeping costs down and passing the savings on to the members has been their operating philosophy. (Costco‚ n.d.) Today there are more than 600 warehouses worldwide with sales exceeding $64 billion. (Costco‚ n.d.) With a yearly membership fee ranging from $35.00 to $100.00‚ this provides
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