...Strategies Case Study #2 Competition among the North American Warehouse Clubs As of 2010 the nearly $215 billion discount warehouse and wholesale club segment within the North American retailing industry consisted of three major competitors (Thompson, C55-73). These competitors included Costco Wholesale, Sam’s Club which is also a Wal-Mart subsidiary, and BJ’s Wholesale Club. All three of these warehouse clubs also competed with a wide range of other types of retailers such as retailer discounters like Wal-Mart and Dollar General, general merchandise chains like Target and Kohl’s, specialty chains like Office Depot and Staples in office supplies and Best Buy in electronics and DVDs, supermarkets, gas stations, and even internet retailers (Thompson, C55-73). The competitive forces which influence these wholesale businesses are the suppliers, substitute products, buyer, new entrants, and rival firms. The strongest force out of these five competitive forces is rival firms. Costco, Sam’s Club, and BJ Wholesales are all competing for equivalent buyers within the North American wholesale club industry and market. BJ while on the smaller scale, does still have competition from both Costco and Sam’s Club, however they have not been as affected by their competition on the East Coast. Unlike BJ Wholesale Costco and Sam’s Club are both international. Even though Costco has a considerable market share they still have pretty stiff competition when it comes to Sam’s Club. The reason...
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...Sam’s Clubs GLOBAL INDUSTRY ANALYSIS - CASE STUDY Wal*Mart Stores, Inc. a presentation p 1 Sam Walton Founder of Wal*Mart Stores, , Inc. Performance of Wal*Mart 20-year average return on equity of 33% Compound average sales growth of 35% Market value = $57.5 billion $ Wal*Mart Sales per square foot $300 Industry average $210 WAL MART Background 2 Year 1988 CEO: David Glass COO: Don Soderquist How to sustain the company’s phenomenal performance? 1987 Net sales Net Income Number Of Stores Number Of Stores Discount Stores Sam’s Wholesale Clubs Supercenters 1,114 84 N.A. 1,953 419 68 15,959 628 1993 67,345 2,333 WAL MART Background 3 Number of Stores (1994) 0 500 1000 1500 2000 Hypermarkets Warehouse Clubs Warehouse Outlets Wal*Mart Stores WAL MART Background 4 Where Emerged in the U.S. g When Mid-1950s Top 10 discounters in 1962 Wal*Mart remained only The industry became more concentrated Discount store companies p operated 50 or more stores accounted for 82% CR5 (1986) 38% 62% CR5 (1993) 29% 71% WAL MART 5 Discount Retailing Discount Retailing Industry Sa ales Grow wth 30 20 10 0 25% 9% 11.2% 7% WAL MART 6 Discount Retailing Comparative Pricing Study, 1993 WAL MART 7 Discount Retailing Overall Performance of Discounters WAL MART 8 Discount Retailing Year 1945 Ben Franklin franchise store In 1950s 15 stores Year 1962 Wal*Mart Discount City store Year 1969 18...
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...Nova Southeastern University Wayne Huizenga Graduate School of Business & Entrepreneurship Assignment for Course: MGT 5090 Entrepreneurial and Strategic Thinking Submitted to: Ron Steffel Submitted by: Georgette McIntosh N01 Xie Luxuan Dorquidia Alemany Date of Submission: May 3, 2015 Title of Assignment: Costco Case Study CERTIFICATION OF AUTHORSHIP: I certify that I am the author of this paper and that any assistance I received in its preparation is fully acknowledge and disclosed in the paper. I have also cited any sources from which I used data, ideas of words, whether quoted directly or paraphrased. I also certify that this paper was prepared by me specifically for this course. Student Signature: Georgette McIntosh ******************************************* Instructor’s Grade on Assignment: Instructor’s Comments: EXECUTIVE SUMMARY he purpose of this report was to examine the implications on employees motivations used at Costco Wholesale Corporation. Research for this report included a review of he purpose of this report was to examine the implications on employees motivations A. Problem Statement: State the main problem facing the firm (or industry) in one, succinct sentence. B. Analysis: Summarize the main findings of your analysis. You may use bullet points, bold, italics – any means to convey and highlight the key factors you have determined based on your analysis. C. Alternatives:...
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...Case Study Analysis 1: Costco Wholesale Corp: Mission, Business Model and Strategy MGMT 670: Strategic Management Capstone June 26, 2011 Business Case Study: Costco Wholesale Corporation Introduction As a student in MGMT 670: Strategic Management, the capstone course for the Management track at the University of Maryland University College, I was asked to prepare a case study analysis of Costco Wholesale Corporation. Costco is one of the world’s leading wholesale retailers with annual sales of $76.3 Billion for fiscal year (FY) 2010, which is an increase of 9% from the previous year ($69.9 billion). In addition, its earnings per share increased to $2.92, an annual increase of 18% from the previous year. (Costco Financial Report, 2011) This increase is an all time high for the company thereby solidifying its place as a leader in the wholesale industry. Costco and its Business Strategy From inception, Costco’s business strategy has been to offer limited products (4000) at lower prices coupled with great values while keeping overhead costs low. In its main product line Costco has about 3,000 products that are present in the stores at all times and 1000 products that are ever-changing. These 1000 lines allow Costco buyers/merchandisers to hunt for items that will keep customers coming back to see what is new or fresh in the stores. These items help Costco create the “treasure hunt” environment that will keep customers coming back to the store more frequently. The motivation...
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...Introduction Costco Wholesale Corporation "Costco" operates in the discount warehouse and wholesale club industry segment. Costco has had a long history of successful management and recently has come under new leadership. The warehouse and wholesale club industry has three main competitors in the North American region however it is facing increasing pressures from low-cost retailers, nationally and Internationally. Although still profitable, the company experienced some erosion of their growth rates during the most recent fiscal year (2015). Costco's new management team will need to focus on the company's core competencies of low-cost leadership and providing superior customer value to maintain its market position within this market segment. Mission & Growth Strategy Costco's mission is "to provide the highest quality goods and services at the lowest possible prices while providing excellent customer service...." (Thompson, 2012). They strive to provide their members with un-matched value, a treasure hunt shopping experience and high quality service. Their philosophy entails taking care of their staff, the staff provides quality care to the members, and member retention will provide financial gains to the shareholders. Their growth strategy is achieved through opening new warehouses throughout the world and increasing club memberships. Club membership fees are a critical component of Costco's financial success. Membership fees accounted for approximately 70%...
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...hpu | Case Study: Costco Wholesale vs. Sam's Club vs. BJ's Wholesale | Management 4001 | | Danielle Lewis | 2/3/2012 | | Costco Wholesale vs. Sam's Club vs. BJ's Wholesale The main strategic issue that is faced by Costco (and by Sam's Club to a lesser extent) is the fact that it has trouble competing with BJ's Wholesale on some key factors of customer service. Costco is a warehouse-style retailer, just like the other two companies. Typically, these companies offer lower prices, but consumers who shop there also need to buy their items in bulk (Thompson, 2011). They get fewer perks, such as fixtures and décor, but that saves them money in the long run. It is a very "no frills" shopping experience which suits many people who prefer to buy their items in bulk and not have to shop as often as they otherwise would (Barrett, 2003; Thompson, 2011). Mostly affluent and middle-class people shop at these kinds of stores, as well as many small business owners. People who have less money typically stay away from Costco and other, similar stores because there is a membership fee and buying in bulk can result in larger outlays of money at one time - something many people with lower incomes simply do not have. While Costco is doing well, its strategy of providing that no frills experience for buying bulk goods has been recently called into question. It has been called into question because Sam's Club and BJ's Wholesale are doing more now in order to provide customers...
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...CASE STUDY 1: COSTCO WHOLESALE IN 2008: Mission, Business Model and Strategy A retailing company with a mission to continually provide members with quality goods and services at the lowest price possible, Costco Companies, Inc.’s business model was to generate high sales volume and rapid inventory turnover by offering members very low prices on a limited selection of nationally branded and select private-label products in a wide range of merchandise categories. It is very much appealing as small businesses are the definite target customers. Low price definitely attracts more customers, and is strategically advantageous to this kind of industry. Costco’s low price strategy is the highlight of the company’s strategy and is very powerful and keeping the business hot to the customers. Its merchandising strategy in limiting selection to only about 4000 items is also good keeping in mind that the mission is to provide low price items, thereby lowered operational cost in stocking of these items. Treasure hunting balances the “routine-ness” of Costco and adds a state of excitement to buyers so they would regularly check out what’s new. Its low profile marketing and advertisement is being kept at minimum cost which is strategically aligned with the mission. Website sales also increases sale as it is convenient to the customers. Jim Sinegal is the key contributor in most of the success being celebrated by Costco. For instance, it is dubbed as the fourth largest retailer in the United...
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...Case Study 3 – Wal – Mart Stores, Inc. Abstract Wal-Mart is the leading retail company in the world, one of the top ten most well-liked companies in the United States. This company tries even when they on the top to give some improvements in every section that are possible to develop. With this kind of plan Wal-Mart will have nothing but a great future. CASE STUDY 3 – Wal – Mart Stores, Inc. History Walmart was founded in 1962, with the opening of the first Walmart, he mortgaged his home and borrowed against everything he owned to open his first Wal-Mart in Rogers, Arkansas, a neighboring town of Bentonville.The second store did not open another two years, but Wal-Mart managed to grow into America’s largest retailer. Walton's revolutionary plan was to have large superstores in rural towns that discounted a wide variety of products. His initial approach was to Ben Franklin. They turned him down as they did not like the idea of operating with lower margins. The result of all that were lesser rents and fair wages. Also the key factors that were important role are an excellent distribution network, technological advantage and careful cost control. The proof that Wal-Mart has done great job in the past is the fact that Fortune magazine listed company in top ten “America’s Most Admired Companies” (Anthony, Kacmar & Perrewe, 2010). Efficient Operations . From 1990 sales went up for more than $25 billion to more than $374 billion in 2007. Wal-Mart has 979 stores, 2435 supercenters...
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...Evaluation of the qualitative study: ‘In the Club: Ecstasy Use and Supply in a London Nightclub’ Table of contents: 1. Overview 3 2. Qualitative research approach methods and Quantitative research approach 4 3. The strength and weakness of Observation data collection 6 4. The strength and weaknesses of in-depth interview 6 5. Focus group discussion 7 6. Conclusion 9 7. References 10 Overview The aim of this report is to evaluate the qualitative study ‘In the Club: Ecstasy Use and Supply in a London Nightclub’ by Bill Sanders which was published in 2005 in the Sociology journal. The report will give a brief overview of the research aims, a description of the methods used, and explain the main findings reported in the paper that have been selected. A discussion of why a qualitative research approach has been chosen for the research question or questions posed in the study will also be evaluated. Furthermore, the use of an extended evaluation of the strengths and weaknesses of the method or methods used in the research will focus in particular upon their appropriateness to the project’s key research question or questions posed and the robustness of the claims made in the article. Finally, a consideration of the potential contribution that a different qualitative method could have on the research question asked will be conducted to assess its strengths and weaknesses. The research was to explore what was widely known about...
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...Costco case study and strategic analysis Costco Wholesale Corporation (Costco), one among the few largest wholesaler giant differentiates itself applying unique strategies relating to production and operations, and marketing which make it stand out from the rest of the retailers who are also said to be competitive in the retailing and wholesaling business globally. Costco is one of the innovative wholesalers teamed by very dynamic management team and dedicated, motivated and satisfied workforce with the mission “to continually provide its members the best quality products at the lowest possible prices” (Costco Annual Report 2006). Some of the fundamental principle of the Costco is that they obey the law, they take care of their members, they take care of their employees, they respect their suppliers, and finally they reward their shareholders. Some of the reasons how Costco can serve those highest quality goods of national brands for the lowest possible prices is that they eliminate different cost associated with delivery expenditures, account receivable, inventory, sales people, and fancy buildings. And they successfully operate themselves in the competitive environment serving not only an individual customers but also a legal customers (a company), and small business customers. Costco believe that society and the community is one of the key factors of their success. Therefore, they are willing to give back to their community and the society in terms of quality goods in...
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...Read the case study “Wal-Mart Goes South” below and respond to the following questions: 1. How much of Wal-Mart’s success is due to NAFTA, and how much is due to Wal-Mart’s inherent competitive strategy? 2. How has the implementation of NAFTA affected Wal-Mart’s success in Mexico? 3. Faced with going out of business, what steps did Comerci take to remain competitive? What other steps do you think Comerci should take to secure its future and further compete with Wal-Mart’s operations in Mexico? APA format is required for text citations and references. You are expected to support your answer with: (1) the textbook “International business environments and operations (twelfth edition), Daniels, J. D., Radebaugh, L. H., & Sullivan, D. P. (2009). New Jersey, NJ: Pearson Education, Inc.”, and (2) news articles, internet articles, and academic source. WAL-MART GOES SOUTH Comercial Mexicana S.A. (Comerci), one of Mexico’s largest retail chains, is faced with a serious dilemma. Since Wal-Mart’s aggressive entry into the Mexican retail market, Comerci has found it increasingly difficult to remain competitive. Wal-Mart’s strong operating presence and low prices since NAFTA’s lifting of tariffs have put pressure on Comerci, and now management must determine if Comerci’s recent participation with the purchasing consortium Sinergia will be sufficient to compete against Wal-Mart. What’s caused this intense competitive pressure on Comerci, and what is likely to be its...
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...Wal-Mart, an Organizational Analysis Kenneth Russell Strayer University Dr. Mary Tranquillo Bus. 310 November 6, 2012 Wal-Mart, an Organizational Analysis Introduction I will thoroughly discuss in detail the operation of Wal-Mart, the company’s strategies, legal concerns and various challenges the company faces. In addition, I will address any current (or anticipated) human resource issues concerning the expanding into the international market and make recommendations on how the organization can leverage its human resources to come out on top in a highly competitive market. Wal-Mart, an Organizational Analysis Describe the nature of the organization, its size, and any specific human resource challenges it faces. One of the most recognized retail chains around the world, Wal-Mart is an American public multinational corporation running chains of large discount and warehouse stores. Considered the largest public corporation when ranked by revenue, Wal-Mart boasts a staggering 2 million employees worldwide with approximately 1.4 million in the United States. (Wal-Mart, 2012). Wal-Mart is known for their brand of low prices and high volume which dominates the retail market. Wal-Mart’s mission statement and slogan sums it up in one simple phrase: “We save people money, so they can live better”. Wal-Mart’s idea and strategy is targeted at offering consumers a variety of name brand goods at competitive prices. Wal-Mart has over 10, 300 retail stores in 27 countries...
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...Case Study One Daniel Smith Southern Wesleyan University April 2, 2016 1) Think back on our discussion in the chapter section, Caveat Emptor-Be An Informed Consumer, evaluate whether the replacement of highly paid workers with lower-paid workers did or did not cause Circuit City to perform so poorly. How confident are you in your evaluation? Why? After reviewing the article, one can be confident that the replacement of highly paid workers was what made Circuit City perform poorly, which led to Circuit City closing. One can be confident that high paid skilled workers is what hurt Circuit City due to Best Buy being able to outperform Circuit City with less quality people and lower wages. Highly paid workers hurt Circuit City due to Circuit City not being able to compete with Best Buy; then replacing the high paid skilled workers with lower paid unskilled workers is what put Circuit City over the edge. The only way that Circuit City could compete with Best Buy is through customer service and when it replaces the high paid workers, it lost the customer service too. 2) Do you believe that the compensation changes at Best Buy are a major reason for its current difficulties? Since Best Buy is making cuts in departments that will not affect customer service, one can determine that the compensation changes are not a major reason for Best Buy’s current difficulties. The major reasons for Best Buy’s difficulties are increased competition from discount stores like Amazon...
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...for its heavy investment in information technology. David Glass and Don Soderquist faced the challenge of following in Sam Walton’s footsteps. Glass and Soderquist, CEO and COO, had been running the company since February 1988, when Walton, retaining the chairmanship, turned the job of CEO over to Glass. Their record spoke for itself—the company went from sales of $16 billion in 1987 to $67 billion in 1993, with earnings nearly quadrupling from $628 million to $2.3 billion. At the beginning of 1994, the company operated 1,953 Wal*Mart stores (including 68 supercenters), 419 warehouse clubs (Sam’s Clubs), 81 warehouse outlets (Bud’s), and four hypermarkets. During 1994 Wal*Mart planned to open 110 new Wal*Mart stores, including 5 supercenters, and 20 Sam’s Clubs, and to expand or relocate approximately 70 of the older Wal*Mart stores (65 of which would be made into supercenters), and 5 Sam’s Clubs. Sales were forecast to reach $84 billion in 1994, and capital expenditures were expected to total $3.2 billion. Exhibit 1 summarizes Wal*Mart’s financial performance 1984-1993. Exhibit 2 maps Wal*Mart’s store network. The main issue Glass and Soderquist faced was how to...
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