Description
Write only a two-page, please.
1. Why is Costco successful?
2. How does Costco make money?
3. Is the proposal discussed in the case (entering new the categories) a good idea?
4. Why would they consider those categories and not others?
* Notes:
- Make sure to cite the parts that you are going to use in text with the author's name and page number.
- I have attached the case. Thanks in advance.
Explanation & Answer
Attached.
Running head: COSTCO
Name
Institutional Affiliation
Date
COSTCO
2
Costco
Costco has managed to be successful as one of the major retailers in the country for the
following reasons. First is the business model they adopted. Costco adopted a warehouse club
retail business model which relies on the bargaining power, no-frills shopping atmosphere and
customer friendly markups on branded products. This type of business ensured that they didn’t
waste money on the various amenities because all they needed was a warehouse to sell the
products (1999, p. 2). There was also a good relationship with suppliers as they would purchase
goods in bulk hence managed lower pricing and maintained a competitive edge in the market
(1999, p. 2). The other reason is the excellent relationship that the company has with the
employees giving them high wages and benefits which see th...