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SWOT Analysis

SWOT Analysis. Presented by Angel Fion Neil Pita& Stephen FJU English Dept. Business Commnucation. Introduction. A membership warehouse club Founded in 1983, Seattle The fourth biggest general retailer in the United States, after Wal-Mart, The Home Depot, and Kroger.

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SWOT Analysis

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  1. SWOT Analysis Presented by Angel Fion Neil Pita& Stephen FJU English Dept. Business Commnucation

  2. Introduction • A membership warehouse club • Founded in 1983, Seattle • The fourth biggest general retailer in the United States, after Wal-Mart, The Home Depot, and Kroger. • 132,000 full- and part-time employees • 51.8 million members

  3. Locations • Costco has 543 locations around the world. • 398 in the United States and Puerto Rico • 75 in Canada • 31 in Mexico • 20 in the United Kingdom • 8 in Japan • 6 in South Korea • 2 future locations in Australia • 5 in Taiwan • Kaohsiung(1997)

  4. Business Philosophy • Product Strategy Fion Wu • Store Philosophy • Membership Neil Chen

  5. Business Philosophy Our Operating Philosophy Is Simple • Keep costs down and pass the savings on to our members. • Our large membership base and tremendous buying power, • combined with our never-ending quest for efficiency, • result in the best possible prices for our members. - Quoted from COSTCO website

  6. Product Strategy Choose the most popular brand of each category Bulks Size Sale Import New Products Promotion

  7. 賣場的經營管理 Store Philosophy • 所有商品以原運送棧板的方式進貨並陳列於簡單的賣場環境。 Simple Display • 提供會員安全整潔的購物空間，走道寬敞、舒適。 Big, Safe, Comfortable Shopping Space • 商品的處理，有關溫度控制及衛生均有嚴格控管。 Strict Control on Conditions of Products Serving • 儘可能的提供給會員更多的免費服務，例如：免費輪胎安裝/ 平衡服務，免費視力檢查/ 鏡架調整服務， 免費停車。 Offer as more services as possible to our customers • 賣場採自助式，並使用紙箱而非塑膠袋包裝商品。 You have to help yourself ; Offer paper box and Reduce unnecessary plastic pack. • 微量的廣告文宣。 Few DMs

  8. Membership • Membership would compromise COSTCO the operating cost and administrative cost and lower down the products price they offer to the customer, usually lower than the competitors • You pay for the membership annually. The more you shop here, the more you get.

  9. Strength＆Weakness Angel Chang

  10. Strength • Diversified products and services • Strong market position • Low cost promotion and marketing strategy

  11. Strength I. Diversified products and services • Various national brand • Private label Kirkland • Various services ex: self-service gasoline stations at a number of US and Canadian locations

  12. Strength II. Low cost promotion and marketing • the 4th largest retailer in the US • the 8th largest in the world • ranked 29th in the Fortune 500 list of America's largest corporations based on sales

  13. Strength III. Low cost promotion and marketing strategy • conducting direct mail marketing • new members follow on from word of mouth advertising Gold star member card

  14. Weakness • Concentration of operations in Californian market • Lax quality control • Weak compliance function

  15. Weakness I. Concentration of operations in Californian market • increasing unemployment levels • increased prices of food and energy • declining housing prices • natural disasters

  16. Weakness II. Lax quality control • several product recalls III. Weak compliance function • failed to properly compensate employees for overtime work • improper bonus formula relating to overtime pay

  17. Opportunities ＆ Threats Pita Chen

  18. Opportunities Growing demand for private label products: Kirkland

  19. Opportunities Increasing online sales: www.costco.com

  20. Opportunities Year 2006: opened 25 warehouses Year 2007: opened 31 warehouses Year 2008: plans to open 35 warehouses Expanding market presence:

  21. Threats Increasing competition: Wal-Mart, the largest retailer in the world

  22. Threats Increasing competition: low cost operators sell single category or a constricted range of products

  23. Threats Owing to weakening labor market and harder borrowing standards A decline in consumer confidence could adversely affect Costco's revenues. Lower consumer confidence:

  24. References • www.datamonitor.com • www.costco.com.tw • http://en.wikipedia.org/wiki/Costco_Co.

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