Introduction
The Price Club was Costco’s first location, which opened in 1976. The company started in a converted airplane hangar and started off as a small business. By changing its selected target from business members to families and seeing the potential growth of the business, the small business was transformed into a warehouse industry. The first Costco warehouse was opened in Seattle in 1983. After the success of the warehouse, Price Club and Costos merged together and were first introduced as PriceCostco, but eventually Changed to Costco Companies, Inc. Costco has grown into a successful industry with 848 warehouses located worldwide. Due to the success and growth of Costco, it is one of the top five largest and most popular retailers
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Costco earns most of its profit from sales and membership fees. By having a wide variety of goods sold at Costco it has benefited their income. Costco is all about its members, and catering to their needs and wants has allowed it to become profitable. Through membership fees, Costco can increase its annual income by a small percentage. Costco offers three different levels of membership, ranging in price from $60 to $120. The first level of membership is business, which is any business or store with a retail sales license that is qualified for business membership, allowing these customers to shop for resale, personal, or business use. The next level is a gold-star member that allows the member to shop online and in warehouses and includes two free membership cards. The last level is the executive member, who offers many benefits and perks. With executive membership, members receive a 2% annual reward, receive up to $1,000 on Costco travel purchases, shop online and in the warehouse, and receive two additional membership cards. As members of an executive club, you can purchase additional services such as auto insurance, homeowner insurance, long-distance phone services, mortgage services, and discounted business services such as health insurance and merchant credit card …show more content…
Costco's main target market is middle-to upper-income and educated customers. Costco is catered to those who own jobs, such as management, medicine, finance, law, IT, and government. Costco also targets adults aged ≥ 30 years. Costco appeals to this targeted market by offering various goods. Often, the people entering Costco are adults with families who are looking to find a store to buy everything they need in one store. With the diversity of products, customers are able to buy products in bulk. Through this Costco has been able to grow profitability while growing amongst the population and creating a fan
According to the statistics in 2015 Costco made 116.2 billion compared to Sam’s Club 57 billion. How is it possible that Costco is beating Walmart and Sam’s Club? Costco has 671 stores and Sam’s Club has 647 but one Costco store makes double what one Sam’s Club makes in revenue a year. Costco pays their employees better than Sam’s Club for example a cashier will start off at 13/hour compared to Sam’s Club at 9/hour this alone will create a better work culture.
Financial Analysis The Home Depot has consistently produced excellent financial numbers, especially over the past few years. These results solidify them as the leader in the industry. Strong financials and pure size of the company are two contributing factors to success. As importantly, statistical analysis show The Home Depot to be an extremely well managed corporation. Total sales from Q3 2016 totaled $22.15 billion, an increase of 6.1% from the year prior.
They also opened at around the same time, not really that long ago compared to other stores. They are both very similar to each other, but have a few differences. Costco’s first warehouse opened up in Seattle, 1983. In 1993, Costco actually struck a deal with Price Club to combine stores. They named the stores PriceCostco.
This calculates to total revenue of $88.915 billion. Exhibit 1 also states that the net income for the year was $1.462 billion. By dividing the 2011 net profit by that year’s total revenue we find that Costco’s net profit margin for 2011 was only 1.64%. Note that net income was less than the membership fees. The net profit margin indicates the business itself would make little or no money.
Only criticism that this warehouse receives is about the long lines at billing counters and having to buy things in bulk. Surprisingly, Costco sells goods at break-even point. Only way it generates profit is from membership fees. The CEO and co-founder of Costco, Jim Sinegal is on the road for most part of the year, visiting every store of the company worldwide. He personally sees what is selling and what is not, which makes Costco a success.
Brand: Costco Landing Page: https://www.costco.com/join-costco.html?qid=73479678a8c411ed800b74dd0a1cb826&cjevent=73479678a8c411ed800b74dd0a1cb826 Theme: Membership sales Title: Don’t Miss Your Chance to Save as a Costco Gold Star Member Costco has been helping its members keep their pantries stocked and their wallets full since 1976. This world-famous warehouse club has come a long way since opening its first location. It now has nearly 600 locations in the United States and Puerto Rico and more than 120 million loyal cardholders.
Higher menu prices and cost control measures allowed the company to counteract a decreased amount of customers in its stores and restaurants. Cracker Barrel’s fourth quarter revenue for 2014 is almost 3 percent higher than the same quarter last year. Its top line performance exceeded what was predicted by analysts. The company reported earnings of $1.63 per share, twenty cents higher than their earnings per share in the same period last year. Its earnings per share also exceeded predictions.
PRICE CLUB and COSTCO more than the current market for the merger of the two stores. PRICE CLUB for the world's first member of the wholesale and retail stores, was founded in 1976 in San Diego, California, initially to serve small businesses, and later to serve the wider consumer masses, they are open for a group of each purchase , And the first COSTCO stores in 1983, was established in Seattle, Washington, in its business just six years, the annual turnover from 0 to grow to 3 billion US dollars. The two companies merged in 1993 to become PRICECOSTCO and in 1998 they changed their name from Pleasant to Costco Company
The Target Corporation is an American retail company founded in 1902 in Minneapolis, Minnesota. Originally named Goodfellow Dry Goods, the company was later renamed to Dayton's Dry Goods Company in 1903 and finally becoming the Target Corporation in the year 2000. Over the years, the Target Corporation grew and expanded its retail operations and by the 1970s, it had become a well-known and respected discount retailer by becoming the first retailer to offer a private label credit card to its customers. In the 1980s through 1990s, the Target Corporation invested heavily in technology and supply chain management, which allowed it to expand its product offerings and improve the customer shopping experience. In the years to come, the Target Corporation
Costco opened the first club in 1976 in San Diego. After several years, it opened the first Costco warehouse in Seattle. From $0 to $3 billion sales, it just spent less than six years (Costco, 2016). This shows the basic framework has been created. Now Costco is a bright star in the field of retail industry.
Costco’s sales strategy also plays a role in its business model. In the article it states, “They only sell a limited number of brands and, as a result, they are able to increase sale volumes...” This allows the company to buy in bulk and receive
The director of Publicity Stewart K Widdess came up with the name Target. Target was the perfect name because as Stewart said “As a marksman 's goal is to hit the center bulls-eye, the new store would do much the same in terms of retail goods, services, commitment to the community, price, value and overall experience." Therefore, the name was now going to be Target. The first Target opened in May 1, 1962 in Roseville. Target image is that customers are proud to go, and they have created a certain trust between customer and the Company.
Gold Star membership targets the individual or typical household and is offered at $55.00 for an annual membership. Business membership also cost $55.00 for an annual fee and includes household membership and focuses on business owners and managers. This type of membership is used for the purchase of products for business use, personal use, and resale use. The membership owner may add up to an additional six members for an annual of $55.00 each. The Business membership is Costco core target of offering small businesses products with reduced costs intended for resale.
Starbucks’ target audience is not gender-specific as it included both males and females. The age bracket for adults are between the ages of 25-40 years, and children aged 2 years and above. The adults in the target audience are married, and with children. From a social class viewpoint, affluent families are prioritized, focusing on households with middle to high income. Additionally, these are adults that have graduated tertiary education and are now urban professionals.