Case Study 1
Costco Wholesale in 2017 Mission, Business Model, and Strategy
GEB4891
2
Costco Wholesale in 2017 Mission, Business Model, and Strategy
Costco Wholesale is a membership warehouse club which offers a variety of merchandise
Business Model
Costco’s business model entailed generating high sales volumes and rapid inventory
turnover by offering fee-paying members attractively low prices on a limited selection of
nationally branded and selected private-label products in a wide range of merchandise categories.
Generating high sales volume and rapid inventory turnover by offering fee-paying members
attractively low prices on a limited selection of nationally branded and selective private-label
products in a wide range of merchandise categories. Rapid inventory turnover when
combined with the low operating costs achieved by volume purchasing, efficient distribution,
and reduced handling of merchandise in no-frills, self-service warehouse facilities- enabled
Costco to operate profitably at significantly lower gross margins than traditional wholesalers,
