Why Costco Is A Wholesale Club Business

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In 1982, Jeff Broman and Jim Sinegal plan to start a wholesale club business. One year later, the first Costco warehouse was open in Settle, Washington (Costco). In the following years, Costco crossed into national market, it expand their market to United States, Canada, Mexico, Japan, Taiwan, Korea, and the United Kingdom (Costco Wholesale Corporation). Internal strengths Costco provide good welfare to the employees. According to the video, Costco has the highest average wage in the industry, employees have 20 dollars per hour and the company also offers health care coverage. The good welfare in Costco can satisfied the need of employees, they can get the highest income in Costco than in other supermarket. More than that, employees can work as hard as they can for Costco because they have the health care coverage. For Costco, they do not need to worry about the problem of recruiting and they can make sure the quality of service to the customers. Costco understands the customers and they have fewer items in each category for customers to choose. Sometimes, too much items make customers confused because it is hard for them to make decisions among a lot of brands. At that time, some consumers may give up buying those items and it will be a loss for a company. However, Costco lists less items on the shelves and consumers can make decisions easily. For example, the manager introduced that they sale “HEINZ” tomato ketchup for customers to choose and help them to make decisions.

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