Costco Wholesale 2008

2776 WordsNov 1, 201212 Pages
Assignments Questions Costco. 1. What is Costco’s business model? Is the company’s business model appealing? Why or why not? 2. What are the chief elements of Costco’s strategy? How good is the strategy? 3. Do you think Jim Sinegal is an effective CEO? What grades would you give him in leading the process of crafting and executing Costco’s strategy? What support can you offer for these grades? 4. How well is Costco performing from a financial perspective? Do some number-crunching using the data in case Exhibit 1 to support your answer. Try to use some financial ratios presented to help you diagnose Costco’s financial performance. 5. Based on the data in case Exhibits 1 and 3, is Costco’s financial performance superior to that at…show more content…
Additionally, Costco has its own brand named Kirkland Signature. This store-label produces juice, cookies, coffee, spices, tires, house wares, luggage, appliances, clothing, and detergent. The markup here is at fifteen percent, which still result for the wholesale company to be five percent lower than comparables named-brand. The production selection is limited to 4,000 items classified in these category: rotisserie chicken, prime steaks, caviar, flat-screen TVs, digital camera, fresh flowers, fines wines, caskets, baby strollers, toys and games, musical instruments, ceiling fans, vacuum cleaners, books, DVDs, chandelier, stainless-steel cookware, seat-cover kits, for auto, prescription drugs, gasoline, and one-hour photo finishing. Although the range can appear wide, only a few products by category are available. Those ones are fast-selling models, sizes, and colors. It is a really good strategy, because it appeals to a variety of element. Commons goods like soft drinks are sold only by big-containers, case, carton, or multiple-pack, not individually. The last element is the "treasure-hunt" thing. Costco buy brand-named product on "the gray market" at a discount price. While some manufacturers do not want to have their product at Costco, because the low pricing strategy can hurt the image, others just do not have any issue with that. This is why it is easy to get big international brand. The treasure-hunt strategy consists of
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