Costco Wholesale
Motivation strategies
Foundation
• Costco Wholesale Corporation is an American
membership-only warehouse club that provides a wide
selection of merchandise. It is currently the largest
membership-only warehouse club in the United States
and as of 2015, the second largest retailer in the world
(after Walmart)
• Areas of operation:
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496 locations in 43
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U.S. States & Puerto Rico
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90 locations in nine
Canadian provinces
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36 locations in 18
Mexican states
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28 locations in the
United Kingdom
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25 locations in Japan
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12 locations in Korea
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12 locations in Taiwan
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8 locations in Australia
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2 locations in Spain
• Number of warehouses: 708
• Membership Data (as of 31st
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August 2016):
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81 million cardholders
Typical Warehouse size:
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143,700 square feet
Annual revenues $113.7
billion
• Number of employees
(worldwide):
216,000 full and part-time
History of growth
• The company's first location, opened in 1976 under the
name of Price club in San Diego. Originally serving only
small businesses, the company found it could achieve far
greater buying clout by also serving a selected audience
of non-business members. With that change, the growth
of the warehouse club industry was off and running. In
1983, the first Costco warehouse location was opened in
Seattle.
Costco’s products and services
• Wide range of products
from fresh food to
pharmaceuticals and
tires
• Initially only boxed
products
Costco’s private label
• Auto and home
insurance
• Photo center
• Costco Auto
• Costco Optical
• Food services
Position among
competitors
• Limited products range
• One size, one brand
• Verifiably low prices
• Membership
• No expensive advertising
Motivation: workforce structure
“You don’t have to be Nordstrom selling $1,200 suits in order
to pay people a living wage. That is what Walmart has lost
sight of. A lot of people working at Walmart go home and live
below the poverty line. You expect that person to come in
and develop a rapport with customers who may be spending
more than that person is making in a week? You expect
them to be civil and happy about that?”
• Staff should be treated fairly
• Costco hires from the inside
Motivation: Employee Benefits
• Health care
• Dental care
• Pharmacy program
• Vision program
• Free samples.
Need we say more?
Motivation: workers’ incentives
• High wages for employees
• Reasonable salary for CEO
• Thanksgiving!
• It embraces equality
• Employees’ loyalty matters
Reasons you would want a Costco
membership:
• Great prices
• Sample carts
• Savings
• Wide range of any products
• Refund
• Friendly staff
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Reasons you wouldn’t want a Costco
membership:
• you’re shopping for small or unique items;
• you get tired of the same food/drink/flavor easily
• Too far
• you’re brand loyal
• Too busy
• Membership
Sources
• https://en.wikipedia.org/wiki/Costco#Costco_today
• http://www.vault.com/company-profiles/retail/costco-wholesale•
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corporation/company-overview.aspx
http://www.investopedia.com/articles/investing/070715/costcos-business-modelsmarter-you-think.asp
http://www.costco.com/benefits.html
http://www.costco.com/about.html
http://www.businessinsider.com/are-you-really-getting-a-better-value-when-youbuy-in-bulk-2011-10
http://brandongaille.com/costco-business-model-and-their-strategy/
http://manapprovedreviews.com/the-pros-and-cons-of-a-costco-membership/