R M Butler
Week 4 Business Analysis Part 1
Strengths Weakness, Opportunities, Threats analysis of Costco Wholesale starts off with their strengths. Diversified products and services, rapid turnover of inventory, efficient operating structure, strong market position, low cost promotion and marketing strategy, and Costco offers its customers the lowest prices on a wide range of branded products. Provides results in high volume of sales from single vendors, allowing for reduction in price, and reducing market cost. Costco wholesale also saves money by not stocking extra bags or packing material, to carry out their goods members must bring their own bags or use the merchandise shipping boxes for the company’s outside vendors.
Weaknesses consist of operating on a large scale means difficulty in bringing changes to the grass roots level, concentration of operations in the California market, lax quality control, and weak compliance function. Costco business conditions constantly change because their external and internal forces that make up other participants constantly change their actions (www.costcowholesale.html.com) Costco wholesale does not carry multiple brands or varieties where the item is essentially the same when it has a house brand that sell under Costco’s Kirkland signature label. If Costco’ management felt the wholesale price of a product is too high they will refuse to stock it, therefore leaving its customers to search at a competitors for the item.
Opportunities consist of a growing demand for private label products, expanding market presence, increased online sales by creating a website in, United States and Canada to be more effective in the global internet market. As of September 2011 Costco wholesale warehouses in the United States, Canada, Mexico, the United Kingdom, Japan, South Korea, Taiwan and Australia with its largest wholesale warehouse located in Hillsboro Oregon (2011 Top 250 Global Retailers.org). Costco wholesale is as of 2012 (NASDAQ-COST) as the seventh largest retailer in the world, it is the fifth largest membership warehouse club in the United States.
Threats are increasing completion, the industry of wholesale has a number of individual companies such as Wal-Mart, Target and Sam’s club are highly competitive and have effective strategies, the subprime crisis along with low consumer confidence (Costco wholesale swot analysis .com/retailing swot/39 Costco-wholesale-swot). Sam’s club that is Cost’s main competition has more warehouses; however Costco has a higher sales volume. Costco Wholesale internal stakeholders are those are employees, senior management, board members former board members, volunteers, and may even be stockholders or others owned by the organization that will benefit from the company’s profit. They are also interested in information about the stability and the profitability of the company. The external stakeholders are those that project the company’s interest; they may be clients, community partners members of groups served by the organization are not accessing the services the company or organization, individual who are the suppliers, lenders, which are influenced by the organization but not part of its internal operations? They also include regulators and other licensing agencies outside the company (The Denver Foundation-www.nonprofitinclusiveness.org). Costco is fulfilling the needs of its stakeholders by giving their worldwide customers, bare boned warehouse shopping with none of the fancy amenities found in the typical supermarkets and department stores. Other than offering highly competitive prices on best quality goods and a range of convenience services, they also operate several consumer and business services, ranging from financial planning; health insurance. Costco wholesale gives preferences to its customers and provides them the best value for...