Case Study : Competition among the North American Warehouse Clubs

Jun 18th, 2015
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Three principal competitors: Costco Wholesale, Sam’s Club, and BJ’s Wholesale Club were a part of the nearly $125 billion discount warehouse and wholesale club segment in 2010. These companies drew consumers away from other wholesale markets because they provided lower prices and had lower operating and other costs than most retailers due to the fact that they purchased full truckloads of merchandise directly from manufacturers and displayed the merchandise on inexpensive shelving while always keeping extra inventory.

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Case Study #4Competition among the North American Warehouse Clubs: Costco Wholesale vs.Sams Club vs. BJs WholesaleTeam C: Belinda Rose, Chaddrick Nevills, Keith Blum, Keith Wiltfong, and Vanessa Hill Florida Institute of TechnologyExecutive Summary (Belinda)Executive summary outlining your strategic analysis and recommendations. (Guidelines for writing an executive summary can be found at: http://www.fsb.muohio.edu/fsb/content/programs/howe-writing-initiative/student-resources/Writing%20an%20Executive%20Summary.doc)Synopsis (Chad Nevills)Synopsis of the major case facts, key problems, and strategic issues that management needs to addressThree principal competitors: Costco Wholesale, Sams Club, and BJs Wholesale Club were a part of the nearly $125 billion discount warehouse and wholesale club segment in 2010. These companies drew consumers away from other wholesale markets because they provided lower prices and had lower operating and other costs than most retailers due to the fact that they purchased full truckloads of merchandise directly from manufacturers and displayed the merchandise on inexpensive shelving while always keeping extra inventory.Costcos markups and prices were so fractionally above the level needed to cover operating costs and interest expenses that analysts criticized management for going all out just to gain customers at the expense of charging prices that would increase profits for shareholders and maintain loyal cl

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