Costco Wholesale Club Strategic Plan Essay Example
Evan Wabrick
Strategic Plan
Dr. Watts
4/18/2012
Strategic Plan for Costco Wholesale Corporation
Executive Summary
The retail industry is an extremely competitive environment that poses many challenges for Costco Wholesale Corporation and its competitors. Since many of the stores offer the same products, it may sometimes be very hard for customers to differentiate between retail stores. Even though the economy is recovering from a recession, the retail business is still a mature industry and is improving very steadily. Costco and its competitors are affected by the same political, economic, social, and technological factors, such as taxes, presidential elections, SEC regulations, the economic state of the country, exchange rates, various social characteristics, such as customer age, income and family size, and the growth of e-commerce. All of these external factors have a great influence on how Costco conducts their operations. Costco is a premier leader in the retail industry thanks to their strategic pricing strategy, low cost operating system, and financial stability. Costco is still vulnerable to numerous threats, such as competition, exchange rates fluctuations, increasing labor and healthcare costs, and high exposure to low growth markets. If Costco is to maintain the market share in the retail industry, they should consider the options of offering more customer service in their warehouses, increase online retail sales, and acquire other retail stores for expansion and growth. Finally, if Costco wants to become more competitive and profitable over time, management should implement the recommendation of lowering membership costs and expanding their operations.
Firm Profile Costco Wholesale Corporation is based in Issaquah, Washington and is one of the leading forces in the General Merchandise Stores/Retail Industry. Costco operates an international chain of 600 warehouses where only their membership holders have the privilege to shop.
Strategic Plan
Dr. Watts
4/18/2012
Strategic Plan for Costco Wholesale Corporation
Executive Summary
The retail industry is an extremely competitive environment that poses many challenges for Costco Wholesale Corporation and its competitors. Since many of the stores offer the same products, it may sometimes be very hard for customers to differentiate between retail stores. Even though the economy is recovering from a recession, the retail business is still a mature industry and is improving very steadily. Costco and its competitors are affected by the same political, economic, social, and technological factors, such as taxes, presidential elections, SEC regulations, the economic state of the country, exchange rates, various social characteristics, such as customer age, income and family size, and the growth of e-commerce. All of these external factors have a great influence on how Costco conducts their operations. Costco is a premier leader in the retail industry thanks to their strategic pricing strategy, low cost operating system, and financial stability. Costco is still vulnerable to numerous threats, such as competition, exchange rates fluctuations, increasing labor and healthcare costs, and high exposure to low growth markets. If Costco is to maintain the market share in the retail industry, they should consider the options of offering more customer service in their warehouses, increase online retail sales, and acquire other retail stores for expansion and growth. Finally, if Costco wants to become more competitive and profitable over time, management should implement the recommendation of lowering membership costs and expanding their operations.
Firm Profile Costco Wholesale Corporation is based in Issaquah, Washington and is one of the leading forces in the General Merchandise Stores/Retail Industry. Costco operates an international chain of 600 warehouses where only their membership holders have the privilege to shop.