These factors include rapid turnover of the inventory, running an efficient operating structure, reduced cost of handling of merchandise and generation of high sales volume at each of its store.
Companies like this have the scale and fulfillment processes already in place, so Costco needs to think how to leverage e-commerce and innovate in this space to better compete with these giants of industry, especially if they decide to compete more directly with Costco in the food industry.
The company can identify better ways of performing tasks, managing stores and hiring new employees and can achieve huge gains by implementing these best practices in its vast network of stores. The company has very attractive low prices on practically every good or service offered in its stores and on its website.
The company also competes on a worldwide basis with global, national, and regional wholesalers and retailers, including supermarkets, supercenters, department and specialty stores, gas stations, and internet retailers.
These bring customers back to the warehouse, since they have the belief that they are in fact getting the best price on a wide array of products.
But with lower gas prices, many customers are not as concerned about finding the best deal. It is also offering more organic foods, which will also appeal to a younger, more health-conscious consumer. Limited product mix Exclusivity to members Low profit margins Costco has a limited product mix compared to the wider and more extensive selection available from competitors like Walmart.
By shipping from the store, the company also reduces product delivery time to the customer. These shoppers, between the ages of 19 and 34, should help to drive longer-term sales and earnings at Costco.
Costco created a website in the United States as well as website in Canada to be more effective and competitive in the internet market. This has allowed the company to grow market share and increase its customer base over the years.
The company has recently expanded in Spain, and plans to open up in France in due time. Conclusion on SWOT Analysis of Costco Costco Wholesale is a business with high viability, the reason it has continued to expand even poor economic times. Too, the operating efficiencies achieved by volume purchasing, along with efficient distribution and reduced handling of merchandise in a no-frills warehouse, allows the company to operate profitably at lower gross margins than traditional wholesalers, mass merchandisers, supermarkets, and supercenters.
Also, the company needs to globally expand to exploit the benefits of high-growth economies. The company has the weakness of the limited array of goods and services. Diversification Expansion of product mix Expansion of locations Costco has the opportunity to diversify its business, such as through the addition of new services or an entirely new business in another industry.
The company employed twice as many people and owned about 5 times more retail space than its top 3 rivals. We will address the short-term concerns, as well as long-term opportunities, that the stock offers. Considering the majority of players and shifting trends in the retail warehousing industry, it is always advisable that a company conducts a SWOT analysis in order to determine areas of weakness that require fixing and potentialities that should be fully exploited.
Also, the company needs to globally expand to exploit the benefits of high-growth economies.
Costco must maintain competitive advantage to ensure long-term viability. Southern Economic Journal,80 3The company has also been using promotions, including Living Social, which should attract a younger customer base.
Do you need to buy Custom Written Sample Papers. Its current store base is aroundbut management hopes to reach 1, warehouses in the long term.
As these customers age, they tend to spend less.
Costco has the opportunity to expand the coverage of its e-commerce websites. Costco Wholesale Corporation, SWOT Strengths: * Positive Business Strategy Costco Wholesale in Mission, Business Model and Strategy Costco is one of United States’ largest retailers, serving over variants of convenience products at excellent quality with competent prices.
Costco Wholesale uses its business model to follow its mission statement. However, the internal analysis elements (strengths and weaknesses) and external analysis elements (opportunities and threats) show that Costco’s managers must formulate new strategies for sustained growth and development of the firm.
This Walmart SWOT analysis reveals how the largest company in the world uses its competitive advantages to dominate and successfully grow in the retail industry. It identifies all the key strengths, weaknesses, opportunities and threats that affect the company the most.
A Costco in Neihu, Taiwan. Costco Wholesale Corporation’s SWOT analysis shows that the business has the strengths needed to address its weaknesses, but the. Below is a comprehensive SWOT analysis of Costco. Strengths. Conclusion on SWOT Analysis of Costco.
Costco Wholesale is a business with high viability, the reason it has continued to expand even poor economic times.
Its competitive prices is a key strength that has kept the business afloat for long. Costco’s Mission, Business Model. Costco Wholesale Corporation: Mission, Business Model, and Strategy Problem Identification a) There is an advertising problem b) For purchasing the products, membership cards are required c) In the warehouses, product locating is not successful d) North America has a major market for the sales e) Customer trends should consider.Strengths and weakness of costco wholesale corporation mission business model and strategy