Swot Analysis Of Costco

turning over inventory, the company is often able to sell their products and pay suppliers before the invoice is due, even when the company pays early to benefit from early payment discounts. This frees up capital which allows Costco to finance new inventory purchases with supplier payment terms. Costco then passes

The organizational structure of Costco Wholesale Corporation mainly has a weak matrix. This type of organizational structure abstains a strong functional structure and a secondary divisional structure. In the functional structure Costco groups employee’s base on the business functions, like marketing and accounting. The secondary divisional structure base its business components on location or market.

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

Costco is the greatest wholesale mega store in today’s market opening its first store in 1983 in Seattle, Washington. Its mission statement is "Costco 's mission is to continually provide our members with quality goods and services at the lowest possible prices. In order to achieve our mission we will conduct our business with the following Code of Ethics in mind: Obey the law, Take care of our members, Take care of our employees, and Respect our vendors. If we do these four things throughout our organization, then we will realize our ultimate goal, which is to reward our shareholders."

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

Some main strengths of Trader Joe’s are the strong brand image, their employees, organic and private label products, customer loyalty, and offered unique products. Trader Joe’s strong brand image helps them to attract and retain more customers. Their private labels are named according to the background and nationality of food. They offered an extensive line of private label items with brand names such as Trader Joe’s, Trader Ming’s, Trader Jose, Trader Giotto. Due to their strong brand image, they established themselves as a leading retailer of food and non-food items in the US. Americans ranked Trader Joe’s overall as No. 1 retailer in 2013 (Ager & Roberto, 2014). Trader Joe's offered unique and high-quality products from different countries which attract customers to try new items and stocks of 4,000 items, 80% of which bear one of its own brand names. Trader Joe's describes itself as "your neighborhood grocery store" (Wikipedia, Trader Joe’s). Trader Joe’s claimed that 80% of its customers had attended college. The company described its target market as “intelligent, educated, inquisitive individuals” and they reach this customer by opening store among well-educated residents (Ager & Roberto, 2014). Their customers are too loyal towards their brand image so they keep coming back. Instead of targeting all customers, they need to target new customers in order to grow their business and to keep being a leader in the retail industry in the US. And also, their employee are valuable assets of the company, who led them towards the further growth of the company, therefore they are treated fairly and trained to provide the nice and friendly service to Trader Joe’s customers. Almost most of the people want to work at Trader Joe’s because they pay more than minimum wage and higher compare to other retail stores. New part-time hires earned $12 per hour and full-time employees earned approximately $50,000 per year which is above minimum wages. Plus, they contribute 15.4% of employee's salary towards retirement Saving. Furthermore, they offer good health and others benefits even to part-time employees (Ager & Roberto, 2014).

Publix serves over one million, mostly time-impoverished customers that are becoming more knowledgeable and demanding every day. These customers, who typically live in the nearby area for a generation, spend $5,000 on groceries per year, and many say they don't mind paying a little more to shop in Publix's customer oriented, clean stores staffed with well-trained and friendly employees. In addition, they are cost-conscious bargain shoppers who are turning towards store brands more and more. Finally, their customers are becoming increasingly more health conscious. About 70% of women and 54% of men consider nutrition an important factor in their food purchases (Mujtaba & Johnson).

Costco Wholesale is the nation’s largest Wholesale Club that operates in eight different countries including Australia, Japan, Taiwan, UK, South Korea, Canada, Mexico, and North America. It sells a variety of brand name products as well as their private label brand, Kirkland Signature, at discount prices. These products are sold in bulk packages to small business and individuals who are members. They have three different types of memberships: Gold Star member pays $55, this applies to individuals who do not own a business and the membership comes with two cards, one for each spouse; Business members pays $55, this pertain to small businesses only; and Executive members pay $110, which includes additional products and services to purchase such as insurance, mortgage services, and long-distance phone service. (Hoover’s Company and Industry Reports, 2014). Currently, Costco has 663 warehouse stores all over the world (Figure 1 shows all the key information).

Most wholesalers either cut costs such as employee wages or insurance, or increase prices to increase profit. Costco’s strategy involves treating employees well, cultivating consumer loyalty, and not allowing another corporation to undercut its prices-- ensuring a profitable future.

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)

With hundreds of locations in nine different countries, as of November 18, 2016, Costco has 723 warehouses, worldwide, and a total of 86.7 million cardholders. Each country has different customs, lifestyle, taste and values that characterize the different areas in which the company operates. Although all international Costco warehouse clubs some of the same Kirkland signature brands, there are extensive differences in the variety that reflect local tastes. Therefore, along with offering Kirkland signature brands, Costco also offers a wide selection of merchandise bought locally and specific to each country in order to satisfy each consumer.

Costco is a well-known and well liked wholesale corporation. The company stands by their mission statement that reads as follows “Costco’s mission is to continually provide our members with quality goods and services at the lowest possible prices. In order to achieve our mission we will conduct our business with the following Code of Ethics in mind: Obey the law, take care of our members, take care of our employees, and respect our vendors. If we do these four things throughout our organization, then we will realize our ultimate goal, which is to reward our shareholders.”

Costco is the second largest overall retailer in the United States, and the largest in the warehouse club retailer category with revenues of over $105 billion in 2013. Costco operates with the business model of charging an annual membership fee to its customers in exchange for heavy discounts on selected brands of a wide variety of merchandise. Towards the end of August 2014, the company operated roughly 663 warehouses globally; including 468 in the U.S., 88 in Canada, 33 in Mexico, 26 in U.K., 20 in Japan, 10 in Taiwan, 11 in Korea, and 6 in Australia. They have approximately 76.4 million members, of those were included 31.6 million gold star members. Besides selling merchandise, Costco provides in-store services like onsite fueling stations, pharmacy services, hot-dog stands and optical centers to attract customers to shop there more frequently.

Costco’s CEO, Jim Sinegal, quoted, “Costco is able to offer lower prices and better values by eliminating virtually all the frills and costs historically associated with conventional wholesalers and retailers, including salespeople, fancy buildings, delivery, billing, and accounts receivable. We run a tight operation with extremely low overhead which enables us to pass on dramatic savings to our members”.2 They stored the inventory on racks above the items being sold in the warehouse. That reduced their labor cost and saved them a lot time on handling and stocking. They treat their manager as enterpeneur and allows them to decide what item should be sold in their store. They odered most of the inventory directly from the manufactures. It either came directly to the store or went to their distribution center called crossdocking depots. The point of these deposts were to reduce the transportation cost by making sure all truck are full when they come the store.

Today, Costco operates about 278 membership warehouse stores across 24 US states. Costco has 16