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Costco Wholesale Organizational Structure

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The organizing function of management is a critical part to successful operations at Costco Wholesale. The overall organizational structure of Costco Wholesale follows the mechanistic approach to structure. This approach is one used for a bureaucratic organization. Organizations who employ such structures have a high level of formalization, centralization, and specialization (Robbins, Decenzo, & Coulter, 2013, pp. 140-143). Costco Wholesale uses this type of approach due to the size of the corporation. The job structure of the organization is both a functional and product type departmentalization. Functional departments consist of human resources, administration, member security, member services, receiving, and front end. Other departments fall into the category of product …show more content…

The Colchester Costco location has 8 separate product departments, not including the main product sales, to meet all of the needs of the average consumer. These departments include pharmacy, deli, meat room, bakery, hearing center, optical center, photography lab, and the food court. The most essential and demanding department of the warehouse is where the majority of sales take place, this is the front end. At Costco 314, the front end department has about 80 employees which must be scheduled, managed, and organized to provide the most efficient service to members. This is the job of the front end managers and supervisors. The overall structure of the corporation is a functional structure, this filters down throughout each individual store. At Costco 314, the store is overseen by one general manger, Paul Hogan. He is the one responsible for the overall outcome of the location. This makes the front end the most demanding

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Costco Wholesale Corporation strives to grow and expand through their competitive retail and pricing strategies in their market. As a retail firm, Costco depends on cusumer purchasing capacities (Gregory 2015). Costco offers a limited number of items that are afforadable quality services and goods to their consumers and believes it aids to their continued growing and expanding success. Costco is driven by cost leadership for their retailer store because they would rather maintain the lowest prices possible which enable customers to return. Costco largely relies on their pricing and retail strategy to continue sales and organization success.

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