The objective of this memo is to evaluate Costco’s performance in comparison to Sam’s Club and BJ’s.

Costco Wholesale Corporation is actually a wholesale club that requires customers to buy annual memberships in order to look at their stores. Costco’s main competitors were Sam’s Club and BJ’s Wholesale. Costco purchased Price Club in 1993 which enabled it to thrive within the competitive wholesale industry. In addition, it adopted a technique that was different in comparison with its major competitor, Sam’s Club This enabled costco reviews to become the biggest wholesale club in the industry in 2001.

I. 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 found that Costco’s total revenue were increasing in 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 with a declining rate.

Costco has a higher membership fee and more and this enabled Costco’s total revenue to become higher than BJ’s. This membership fee is essential because it is the key contributor to the company’s bottom line since sales excluding membership fees barely covers operating expenses. Costco also offers more warehouses and far higher sales per store. Costco has warehouses in many international locations while BJ’s just have warehouses in the US. However, Costco features a lower operating and gross margin which implies that BJ’s has better operations and higher product prices than Costco. Costco’s inventory turnover ratio is outstanding because it is much bigger than BJ’s. This clearly implies that Costco posseses an excellent operating efficiency.

II. 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 customer support which makes it Costco’s largest competitor. However, Costco had larger total revenues, sales per store and operating income due to the strategy. This is also because Costco is a lot more internationally dispersed in comparison to Sam’s Club since it has more warehouses in international locations. I am just unable to compare Costco’s financial statement performance with Sam’s Club because Sam’s Club data is joined with Walmart.

III. Costco’s core strength and strategy

Costco pursues the strategy of concentrating on lowering the device cost of goods and purchasing few Stock Keeping Units (SKUs) from its 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 can be separated into two:

• Targeting a wealthier number of small business owners 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 technique is really efficient in providing it having a competitive advantage over its competitors BJ’s and Sam’s Club. This is undoubtedly a long-term value enhancing strategy because costco holiday hours is to create value for their customers. They vpaisq definitely obtain many loyal and satisfied customers that do not mind paying an increased membership fee to sign up with Costco. Costco is another very ethical company since they are not implementing a technique which serves to lower their costs and cheat customers of their funds in an indirect way.

Costco Corporate Office Contacts – Why Is This Critical..

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