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Costco performance analysis
Industry analysis of costco
Industry analysis of costco
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More handpicked essays just for you.
Costco performance analysis
Industry analysis of costco
Industry analysis of costco
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Recommended: Costco performance analysis
Purpose To be an innovative grocery store by providing friendly service, clean stores, quality merchandise, and speedy check-out lanes throughout our locations. Vision To provide excellent customer service that exceeds expectations while building long-term relationships with customers.
Costco Wholesale conducts functions in 8 countries, as well as, being a multi-billion dollar worldwide company. The company also strives to offer a family environment for their employees so they may advance their careers and flourish (Costco Wholesale Corporation, 1998-2016). With it being a large corporation, Costco definitely would endure several financial, along with managerial accounting principles in their operational endeavors. One form of financial accounting information that could be pertinent to Costco exists with Wall Street’s calculations. Costco reported a 25% increase in profit in addition to a 14% commerce boost (Holmes & Zellner, 2004).
According to the Article Costco has a good going Mission statement. " To continually provide our members with quality food and service at the lowest possible prices" the company immediately focused on achieving success through Rapid inventory turnover management and operating efficiencies by volume purchasing. Providing a company that sells in bulks creates amazing sales opportunities for example its annual sales "1.5 million on Televisions, 300 million worth of digital cameras, and even 16 million worth of pumpkin pies during fall season" To achieve such results Costco Strategy was based around low prices, limited selection, and a treasure shopping hung environment. Pricing was important to Costco they mention in the article that they were
The average calories for a meal is around five hundred to six hundred fifty. Most college students get more than one item from Costco, which exceeds the calorie intake for one meal. For most college students, we don't tend to look at the calories or nutrition to be a big part of any of our meals. For me, I see the calories on the board below all of the foods; but I just look at it for fun and nothing more. Although Costco has great foods most of the food lack the nutrition needed for a college students’ body.
Market segmentations is the method retailers use to segment, or break down, heterogeneous consumer populations into smaller homogeneous groups based on certain characteristics.(Dunne,Lusch,&Carver.2014. Pg 92). I feel Costco is a very good example of segmentations and what they provide. Costco is often compared to Walmart because they offer most things that the consumer will need or want. Even though Costco provides most of the things they sell in bulk, the consumer is appreciates that a need is being met.
As the term lean reflects the operation’s goal to eliminate waste from the system, Costco can be defined as a lean company. Some of the efficiencies that Costco obtained, are the fact that it does not advertise and the fact that it has a limited selection of products for sale. Not only they have a limited selection, but their products are not marked up more than 14% over cost. The fact that its prices are not higher than average, is not a synonym for low quality. On the contrary, Costco understands that in order to keep its customers, quality has to be high.
Costco is dealing with high quality and brand-name merchandise as Whirlpool, Sony, Mont Blanc. Costco has an unconditional guarantee with full refund and Costco offers the best lowest possible price. Costco has a special strategy to offer lowest price as No sales people, No fancy building, Warehousing, Purchase in bulk, Minimized restocking and Membership cards. Costco has multitude of services as Pharmacy, Optical and Eye care, Tire Service Center and
Costco Wholesale Corporation manages a global chain of membership warehouses, mainly under the “Costco Wholesale” with the URL http://www.costco.com. Costo's philosophy is to provide its members with quality goods at the most competitive prices. It carries quality, brand name merchandise at substantially lower prices that the merchandise typically found at any other local specialists. The warehouses are created to assist small and medium enterprises in reducing a cost for everyday business and resale for the products. Individual can purchase on their individual requirement.
The last strategy is price and pricing strategy and Costco uses a market oriented pricing strategy. Market oriented happens when the company uses market conditions to help set prices. Costco’s aim to offer the lowest prices possible while for all of their items. Costco at the same time feels that promoting products needs to have value. Once when they have the proper techniques, they should share it with other private wholesalers so they wholesale industry could be the number 1 place for consumers to shop.
The biggest differences I observed between the grocery stores I visited were found in the check-out lines. Walmart Neighborhood Market was the only grocery store with a self-check-out which I think is a great feature. Publix and Trader Joe’s each have friendly staff working at each of their check-out lines. In addition to the regular check-out lines, Publix also has an express line which is helpful when you’re checking out with only a few items. Check-out lines are another great opportunity for building social skills.
2. Costco want to build a long-term sustainable strategy based on targeting these customers. So Costco shall adopt sustainably low cost strategy that can gain a variety of different types of customers and increase market share. Companies that are able to offer lower than existing market price. It can usually lure more business
Costco Wholesale was founded in 1983, in Seattle, Washington by Jim Sinegal and entrepreneur, Jeff Brotman – now chairman of Costco’s board of directors. Costco is a leading brand among the wholesale retail industry. Not only is the brand amongst the three leading retailers in the United States, but it is also the leading membership-based warehouse chain in the world. Costco operates membership-based warehouses where a wide variety of consumer goods are sold wholesale. These product categories include a broad spectrum of goods such as, snack foods, dry and packaged foods, frozen food items, deli and produce goods, dairy products, cleaning supplies, paper products, electronics, health and beauty aids, office supplies and appliances.
Marketing Mix Costco markets towards large families and businesses. How do they do it? Well, unlike their competition, Costco lacks in advertising. It relies more on providing low prices and product value in order to attract its consumers. 1.Sales promotion-
Market Segmentation: To be of value market segments must be measurable, substantial, accessible, differentiable, and actionable (Kotler & Keller, 2012). Segmentation of demographics for Costco is vast as the current product offerings include all genders, ethnicities, incomes. age groups, and social classes. When considering demographics, it is important to consider the average or typical characteristics of the target market. As mentioned earlier the target market or focus for this company is supplying the small- to medium-sized business and targets the middle- to high-end consumer with its private label brand Kirkland Signature.
1.3 HISTORY, GROWTH OF RETAIL INDUSTRY & GLOBAL RETAIL SCENARIO: Global Retail Scenario It is no secret that Retail has a huge role to play in the global economy. That’s why it is not surprising that in developed countries retailing is one of the most important industries. In developed economies, modern retail or organized retail has a 75-80% share in total retail as compared with developing economies.