Costco Stores – Look At The Customer Reviews..

The objective of this memo is to evaluate Costco’s performance in comparison to Sam’s Club and BJ’s. Costco Wholesale Corporation is a wholesale club that requires customers to purchase annual memberships so that you can shop at their stores. Costco’s main competitors were Sam’s Club and BJ’s Wholesale. Costco bought Price Club in 1993 which enabled it to survive within the competitive wholesale industry. It also adopted a technique which was different in comparison with its major competitor, Sam’s Club This enabled Costco to be the largest wholesale club in the business in 2001.

Costco’s Performance with regards to BJ’s – Once I compared Costco’s total revenues with BJ’s total revenues in Exhibit 5 of FIN 197 Seminar in Finance case book, I discovered that Costco’s total revenue were increasing with an increasing rate with the exception of year 2000 to 2001. BJ’s on the other hand, had growing revenues until 1999 when their revenues then started to grow in a declining rate.

Costco has a higher membership fee and much more and also this enabled https://www.storeholidayhours.org/costco-wholesale-holiday-hours-open-closed-today to become more than BJ’s. This membership fee is very important because it is the main cause of the company’s financial well being since sales excluding membership fees barely covers operating expenses. Costco even offers more warehouses and far higher sales per store. Costco has warehouses in numerous international locations while BJ’s just have warehouses in america. However, Costco includes a lower operating and gross margin which demonstrates that BJ’s has more effective operations and higher product prices than Costco. Costco’s inventory turnover ratio is outstanding because it is much larger than BJ’s. This clearly shows that Costco has an excellent operating efficiency.

Costco’s Performance with regards to Sam’s Club – Sam’s Club, on the other hand, has more members and warehouses when compared with Costco that makes it Costco’s largest competitor. However, Costco had larger total revenues, sales per store and operating income because of its strategy. This can be because Costco is a lot more internationally dispersed in comparison to Sam’s Club as it has more warehouses in international locations. I am struggling to compare Costco’s financial statement performance with Sam’s Club because Sam’s Club information is joined with Walmart.

III. Costco’s core strength and strategy – Costco pursues the strategy of centering on lowering the unit price of goods and buying few Stock Keeping Units (SKUs) looking at the vendors which enable production savings. Costco’s core strength was created to provide it with higher total revenues as well as to create value to the customers. Their core strength could be split into two:

• Targeting a wealthier selection of small businesses and middle-class shoppers which is different from Sam’s Club.

• Refusing to mark up products greater than 14 percent within the distributor’s price

Costco’s strategy is really efficient in providing it with a competitive edge over its competitors BJ’s and Sam’s Club. This is undoubtedly a long term value enhancing strategy because Costco’s primary aim is to ctqosf value with their customers. They will likely definitely obtain many loyal and satisfied customers who do not mind paying an increased membership fee to join Costco. Costco is yet another very ethical company as they are not implementing a strategy which serves to lessen their costs and cheat customers of their cash in an indirect way.

We have been a member of Costco for 2 yrs with a business professional membership. I use Costco for most of my company purchases and so i switched to only using Costco rather than having both memberships. Bjs and Costco carry most of the same things. Costco has a more ofice supplies, toys, etcs I want for my online retail business.

I feel Costco and Bjs are equally professional and offer good customer support. BJs has the main benefit of accepting MFR coupons and accepts all major charge cards! Costco only accepts checks and American Express in their warehouses (they are doing accept all major charge cards online though) BJs lines seem to move quickly, and their aisles, at the very least in the ones I actually have been to, are better organized.