SWOT Analysis
Strength Weakness
• Low product and services
• Internal (Home grown) top management team in majority
• Employee’s turnover within a year of recruitment is just six percent
• Unique ability to keep overhead cost low resulting in low prices of goods and services
• Loyal and affluent customer base
• High inventory turnover comparing to its competitors
• Consistent return on sales and return on assets
• Incredible return policy • Comparatively less attractive store layout for luxury items
• Weak advertisement base leading to the inability of reaching full range of membership base.
• Declining or inconsistent profit margins
• Not widely scattered around the world than its competitors
• Location is not attractive in terms of real-estate
• No self-checkout
• Primary focus on business customers rather than individual customers

Opportunities Threat
• Costco’s operations is mainly targeted in countries where there is high GDP and high disposable income of the consumers (Canada, U.S.A and Japan) with low inflation rate in the countries
• Serves the democratic countries with political and governmental stability
• Rapid growth in membership
• Possibility of international expansion
• Advantage of economic downturn
• Increasing brand awareness
• Positive image in terms of employees pay and social responsibility • Costco cannot attract people who are below poverty line due to its membership fees and bulk purchase
• Not well diversified in terms of geography (presence)
• High competition from Sam’s Club and BJ
• Highly dependent on United States and Canadian market.
• Largely dependent on vendors for timely supply of quality