Costco Internal Analysis

COSTCO INTERNAL ANALYSIS

Introduction

The current investigation looks at the company Costco as a successfully managed company, and assesses the effectiveness of the company’s current internal strategies and leadership positively. Costco is in an industry where there is a lot of dynamic competition from huge chains such as Wal Mart and Sam’s Club, and yet it still has been able to maintain a competitive and profitable stance. The current report proposes that Costco has been able to be this success because of a successful internal business model, sound financial leadership, and strategies of teamwork that focus on the customer. “Costco’s first quarter opened just as November ended, and aggressive pricing the company instituted then and through December made sense for a couple of reasons. Driving holiday sales is one, but a big question warehouse clubs face in the current economy is whether consumers worried about their finances will pony up” (Duff, 2008).

The key elements of the Costco’s business model involve a dedicated commitment to cost effectiveness and centering on the customer’s needs and desires, while maintaining an internal culture of creativity, community, and teamwork. “The belief system of the company is that long-term thinking is owed to not just the shareholders but to employees, families of employees, and the communities where Costco does business, as well as to the suppliers of goods and services who employ hundreds of thousands of more people” (Eight, 2011). Costco must take advantage of strategic opportunities in order to meet the challenge of the future, and continue on to conquer its market of selective, inclusive club bargain power centers.

Analysis

A key element of Costco’s internal communication model is the idea that leadership does not come as a dictate from above, but from the agreement of stakeholders. Organizing a plan requires honing it down and making it workable, and only effective decision-makers who are schooled in...