Costcp vs Sams Club

2904 WordsNov 25, 201212 Pages
“Warehouse Club Wars” Costco vs Sams Club Table of Contents Introduction ……………………………………………………………………………………….3 Warehouse Business Model……………………………………...…………………………....3 Costco Background ……………………………………………………………………….……..5 Sam’s Club Background ……………………………………………………………….………..6 Competition and Market Position of Rivals ……………………..…………………….………..7 Comparision across Functional areas ………………………………………………….………..9 What is Cross docking ?……………………………………….………………………..13 What is Vendor Managed Inventory? ……………………………………….….……..14 Vertical Integration and Alternative Sales Channels………………….…………..………..17 Conclusion……………………………………………………………………………………….17 Appendix A – Savings for Members …………………………………………………………...19 Appendix B – Port’s Fiver…show more content…
The first Costco store began operations in Seattle in 1983. Costco Wholesale Corporation (Costco), with its subsidiaries operates membership warehouses that offer its members low prices on a limited selection of branded and selected private-label products in a range of merchandise categories. By offering quality merchandise at a low price, they attract mostly affluent shoppers. Its typical membership profile is a relatively well heeled customer with an average yearly income of $75K. Costco’s Strategy is to sell quality items at low prices and to create a treasure hunt like atmosphere with a set of variable famous brand items available at low prices each week that Its buyers had been able to procure. Costco 's warehouse format averages approximately 141,000 square feet. Its warehouses operate on a seven-day, 69-hour week. It carries an average of approximately 3,600 active stock keeping units (SKUs) per warehouse in its core warehouse business. Many consumable products are offered for sale only in case, carton, or multiple-pack quantities only. It operates warehouses worldwide including countries such as Mexico, UK, Japan, Taiwan, Korea and Australia. Costco and Sam’s Club are more similar than different. They have the same model. Costco is known as an Upscale Sam’s Club. Figure 2 Costco and Sam’s Club Comparison Memberships Offered: Costco offers memberships in the following formats. Gold Star Member = $ 55 Business Member = $ 55

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