Strengths And Weaknesses Of Costco

The strategic objective of Costco is based on the concept of offering members very low prices on a limited selection of nationally branded and selected private label products in a wide range of merchandise categories while producing high sales volumes and rapid inventory turnover. This rapid inventory turnover, when combined with the operating efficiencies achieved by volume purchasing, efficient distribution and reduced handling of merchandise in no-frills, self service warehouse facilities, enables Costco to operate profitably at significantly lower gross margins than traditional wholesalers, discount retailers and supermarkets. (1)

1. What is Costco’s business model? Is the company’s business model appealing? Why or why not?

Promote From Within: “Promote From Within” strategy is promoted by Jim Sinegal, the founder of Costco. Costco does not hire business school graduates but cultivate employees who

Costco has a simple strategy for being one of the leaders in the wholesales, which is concentrating on driving sales. If the sales of a company are good than everything else will take care of itself. While other companies such as Wal-Mart, Target and BJ’s pour money into marketing; Costco has a no-frills approach and doesn’t advertise. Costco focuses on selling fewer items which increases sale volume and

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? Refer to Figure 2.1 in Chapter 2 in developing your answers.

In order for Costco to stay competitive in the market and ahead of its competitors, it is essential to venture into different products and services. Costco’s main products vary, which include: groceries and frozen products, fresh meats and produce, bakery goods, beverages and liquors, health and beauty products, seasonal goods, office products, appliances and electronics. To increase Costco’s product differentiation over its competitors and increase sales, Costco began to introduce other products; such as pharmacy, gasoline, auto insurance, and a food court. In addition, extends more services to executive card members that include check printing, payroll services, identity protection, free roadside assistance with Costco’s auto insurance, and traveling benefits.

Renee McDonald (“Plaintiff”) allegedly sustained personal injuries on October 8, 2015 while shopping at a store owned and operated by Costco (“Defendant”) in Brooklyn Park, Maryland. According to the plaintiff, while walking through the store, she tripped on mop water which caused her to fall to the ground and suffer “severe bodily injuries.” The Plaintiff claims that her fall was caused by the mop water. The mopped area had been secured with a yellow caution sign that warned customers of the wet floor. At the time of the Plaintiff’s fall, however, the sign had fallen down and was lying on the floor. Plaintiff alleges that the store did not have proper signage to warn of the hazardous condition.

Costco is a recognized and successful retail chain including several locations, glowing feedback, and a wonderful overall reputation. Known by several audiences to be considered a “big-box” store, Costco offers various products in its stores at low, discounted prices, accompanying a membership card. Before and after researching this company, the author of this paper has heard exceptional feedback regarding the company for its initiative to keep prices low, employee morale high, and customer satisfaction to be one of its top priorities. Within this body of work, the author will dissect and discuss some of Costco’s stakeholder perspectives and how some of the perceived initiatives may help aid the company within its

Costco is one of the most profitable retail stores in the United States at the moment. This is in spite of the prevailing tough global economic times and stiff competition from stores such as Wal-Mart and Target. Costco, a members’ wholesale retail store, was founded in 1983 in Washington by Jeffrey Brotman, who serves as the current Chairman of the board of directors and James Sinegal, the current company president. Costco has not been spared by the current global economic conditions. They have affected it in a number of ways that have made the company’s management respond in a manner that is meant to ensure that the business not only survives but grows even stronger. First, Costco has taken strong measures to keep

Costco's mission is to “continually provide our members with quality goods and services at the lowest possible prices (Costco Wholesale Mission Statement - Profits and Prices Revolve Around Ethics, 2013)

From the company's inception, Jeffrey H. Brotman has served as chairman of Costco, and James D. Sinegal has been president. While Sinegal had a background in membership warehouses and retail chains (having been mentored by Sol Price, the founder of Fed Mart and Price Club), Brotman was an executive of an oil exploration company and cofounder of a group that operated a chain of apparel stores. In 1985 Costco became a publicly owned company, and in 1993, Costco merged with Price Club to

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Costco has grown from a single location in Seattle, Washington and is now the largest membership based retailer and currently the 6th largest overall retailer in the United States. In 2011, Costco saw a 10% increase in sales and in 2012, Costco is planning on opening 14 new store locations, three of which will be outside of the US. Costco is no longer a small local retailer but now an international company with different threats and opportunities. As the company continues to grow, it is important for Costco to understand the external threats and opportunities that will impact the company in either a positive or negative way. In order understand these forces a SLEPT analysis is used to analyze the social, legal, economical,

What recommendations would you make to Jim Sinegal regarding the actions that Costco management needs to take to sustain the company’s growth and improve its financial performance?

Imagine a store that never advertises, has no signs in its aisles, doesn’t bag what you purchase, and charges you a fee just to walk in the door; Costco Wholesale is that shop. The purpose of this report is to illustrate how Costco as a multinational corporation strategically manages its marketing operation across global markets. For research purpose, this report will be focused on Costco wholesale in Japan and USA.