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Costco internal Environment analysis

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wassim ayass

on 8 April 2014

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Transcript of Costco internal Environment analysis

design by Dóri Sirály for Prezi
Recommendation
non-members day
more languages on the website
acquiring BJ's
Retailing business
Improving technology

He was the Executive vice president for the
Price Company
between 1978-1979 
Co-founded with Jeff Brotman Costco in 1983
Jim Sinegal

membership system

Low profit margins

Low prices
+Limited selection of quality merchandise
+ a wide range of merchandise categories
= high inventory turnover

Business model

Third largest retailer in the USA
THIRD largest retailer in the world
Leader of discount warehouse and wholesale clubs
648 location as of Dec. 31,2013
Lowest prices, limited selection of products


Tangible Resource
Physical Assets
Lands
649 warehouses
Locations
Cross-docking
Packaging facilities



Financial resources
cash and cash equivalent
marketable securities
borrowing capacity
Technological Resources
photo centers
Servers
online shopping
mobile application
Organizational Resources
IT team
planning system
coordination system
control system
organizational design and reporting structure
Intangible resources
Human assets and intellectual capital
well-trained employee
loyal employee (some of them from 1983)
Managerial talent
leadership skills
creativity and innovation of personnel
know-how of specialized teams
Brands, company image and reputation assets
Kirkland signature
co-brand
buyer loyalty and goodwill
reputation for good quality and reliable
reputation with suppliers and partners
Relationships
joint ventures
subsidiaries
co-brand
geographic markets
network of dealers and supplier
trust established with partner
Company culture and incentive system
norms of behavior
ingrained beliefs
attachment of personnel
compensation system
promotion from within
Costco Capabilities
LOWEST PRICES
good Quality
Online Shopping and Online Services
Broad range of Customers
Treasure Hunt
HAppy employees
expansion and growth
More MEMBERS
S
W
O
T
ANALYSIS
Strengths
different products and fresh food
abiding by the code of ethics
the sales volume and the rapid inventory turnover
membership strategy
strong reputation and name familiarity
green policy
strong financial condition
Weaknesses
Jim Sinegal getting old now
disadvantages of the policy of hiring managers and promoting from within
Lacking a PR
A competitive deficiency
Narrow product selection
Decline in liquidity
Opportunities
Growing in new and existing markets
Costco has growth opportunities in e-commerce
environmental challenge
private label items
acquire BJ’s
Threats
competitor or a new entrant
A fierce competition exists in the industry
retailers especially the giant Walmart
elevation in the cost of goods
dependendance on the US and Canadian markets
Behind the Scenes
High volume purchases
+efficient distribution
+low operational costs
= efficient operation

VRIN TESTS
Valuable
Rare
Inimitable
Non-substitutable
Full transcript