“Hit’em where they ain’t” David Sampson Aaron Swanson Pearl Sotelo youtube.com/results?search_query=costco+comedy

The history of Costco Wholesale  1983 first Costco was opened in Seattle  Price Club 1976  Merged in 1993 as PriceCostco  Became Costco in 1997

The history of Costco Wholesale  First Company to ever grow from zero to 3 Billion in sales in less then 6 years  Worldwide company with over 50 Billion in sales in recent years  Philosophy, keep costs down and pass the savings on to our members

Retailing  Presentation Bare Bones  Concrete floors, shipping pallets, & orange steel Wide isles for forklift operation Continuous product moves Costco.com  Products Higher quality or larger quantity than competition  Avoid carrying same items as discount retailers Continuous rotation of inventory  Seasonal & roadshows About 4000 SKU

Members Only  Pricing Less than 14% margin on everything Annual membership fee $50  Executive membership $100  Promotion Minimalist approach to advertising  Coupons, magazine mailed to members  Rebates

Location  NW based company in Issaquah WA  509 worldwide locations 375 USA  9 regions (NW, NC, BA, LA, SD, NE, SE, MW, TX) 71 Canada (Eastern & Western) 30 Mexico 19 UK 5 Korea 5 Japan 4 Taiwan

Oregon Trail  12 warehouses in Oregon Primarily located along I-5 Near other retailers  Albany  Aloha  Bend  Clackamas  Eugene  Hillsboro (Extended Warehouse)  Medford  Portland  Salem  Tigard  Warrenton  Wilsonville

SWOT Analysis Strengths – to build on  Value - Prices & Products- “sell high quality, nationally branded and selective private label merchandise at low prices”  Service strategy- Gas, pharmacies, 1-hour photos, bakery, optical dispensing centers, copy centers…  Customer Service  Differentiation - “hit’em where they ain’t” focused on small business owners  “Treasure Hunt”- constantly moving products around.  Limited assortment of merchandise- allows Costco to achieve high sales volume and rapid turnover

SWOT Analysis Weaknesses - to cover  No marketing/advertising  No large brand variety-  Limited number of SKUs  Finding help in store  Long lines, checking receipts  NEW return policy- as of February 2007  Low profit on GAS in Oregon- because must pay employees to pump gas

SWOT Analysis Opportunities- to capture  Continued growth- locally and internationally Potomac Hills, VA May 2007Tustin, CA - June Kawasaki, Japan – JulyWest Valley, UT – August Greenville, SC – AugustNE San Jose, CA – August Toledo, OH – AugustGrafton, WI – August Selma, TX - September  Online shopping  “Costco Home”

SWOT Analysis Threats- to defend against  Competition - for members, employees, warehouse sites, products and services with local and national retailers.  Economic Factors- Higher interest rates, higher energy costs, inflation, levels of unemployment, and consumer debt levels

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