Promotional Marketing- Costco Analysis

3458 Words14 Pages
| Promotion Strategy: Costco Wholesale | | Introduction and Competitive Landscape Our general findings about Costco are that it is an all-around great, moneymaking, expanding company. To start off, Costco is a membership warehouse that offers its customers low prices on exclusive, private-label products in a wide assortment of merchandise categories that generate high sales volumes and quick inventory turnover. A combination of this turnover, resourceful distribution, merchandise with “no-frill” and a self-service warehouse gives this company extensively lower gross margins than your typical, everyday warehouse or supermarket. To prove that Costco is a moneymaking company all one has to do is glance at the sales figures.…show more content…
In order to cut costs, Costco has a based chain, The Issaquah (Wash.) that eliminates several pricey expenses. Other retailers generally use elaborate display cases, salespeople, advertising and billing, but since Costco doesn’t do this they can put a 15% markup limit on all items and offer great bargains on their merchandise (Regnier). One of the private label brands Costco sells is Kirkland Signature products. Kirkland Signature Products are of equal or better quality then other national brands, which include: diapers, film, frozen foods, luggage, tires, clothing, house wares and more. Since not every store carries Kirkland products if you’re a consumer who uses them you would have to go to Costco to purchase them, which makes Costco have a larger consumer base. Costco not only caters to the average consumer, they also accommodate small and medium sized businesses. By selling such large amounts of merchandise Costco has helped small and medium sized businesses reduce costs on purchasing for resale. Another great aspect of Costco is its high inventory turnover. Since its inventory turnover is so great, they can acquire cash from a sale of a sizeable portion of inventory before they have to pay back their suppliers. Costco’s inventory and merchandise is so huge that they actually had to increase the size of their shopping cart four times. Another great asset about Costco is how exclusive they

More about Promotional Marketing- Costco Analysis

Get Access