Competition among the North American Warehouse Clubs:
Costco Wholesale versus Sam 's Club versus BJ 's Wholesale
The overall Business Strategy of Costco encompasses ultra-low prices, limited selection of nationally branded and private label products, treasure hunt shopping environment, low operating costs, strong growth and effective HR management (Thompson, 2011, p. C-57). With high sales volumes and fast inventory turnover, Costco is able to maintain good working capital. This allows Costco to be an overall low-cost provider.
PEST Analysis of Warehouse Club Industry
• Trade regulations • Health and safety •
Economic: • Recessions • Disposable income • Exchange rates •
• Women in worforce • Environment issues • Dual family incomes
Technology: • Inventory management • Point of sale technology • Logistics system • CSR customer relationships management
Global: • International trades nowadays. • trade in global market to reduce their cost of material • import restricts from different countries.
The lower and middle class customer should be the main customer group
Resource and Capabilities
Tangible resources: 567 warehouses ,including 414 in the United States and Puerto Rico, 77 in Canada, 32 in Mexico, 21 in the UK, 9in Japan 6 in Taiwan and 1in Australia. Merchandise inventories $5405M Cash and cash equivalents $3157M. Intangible resources: brand image, buyer loyalty, goodwill reputation and the strong human assets and intellectual capital of managers. The compensation system and the motivation level of company personnel
Costco has great capabilities in reducing cost and expanding business. Also, they are strong in understanding their customer base with managers who had a