Analysis of Costco Strategic Management

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Case Study 1:Costco Abstract Costco was founded in Seattle, Washington in 1983. The company quickly grew and expanded operations nationally. Today, Costco is the second largest retailer in the United States, and the third largest in the world. Such accelerated growth required calculated planning, vision and execution of strategies. This case study examines the strategy of the company and assess the execution of strategy relative to company goals and values. Costco was founded by Jim Senegal and Jeff Brotman. Sinegal was the company CEO from 1993-2012, and during his tenure he strongly vocalized the values and mission of Costco, and implemented strategies that sustained their competitive advantage. Sinegal parlayed his experience in discount merchandising into forming an organization based upon the principles of aggressively enhancing customer value through low cost advantages. Costco’s mission, business model and strategy integrate efficiently to form a business model that many companies have since mimicked in hopes of duplicating their success. Costco’s mission statement is, “To continually provide our customers with quality goods and services at the lowest possible prices”. Three top executives offered a more expansive view of their mission in their 2011 Annual Report, “The company will continue to pursue its mission of bringing the highest quality goods and services to market at the lowest possible prices while providing excellent service and adhering to a strict code of ethics that includes taking care of our employees and members, respecting our suppliers, rewarding our shareholders, and seeking to be responsible corporate citizens and environmental stewards in our operations around the world.” (Thompson, A., Peteraf, M.A., Gamble, J.E., Strickland III, A.J., (2014), Crafting and Executing Strategy). This mission is firmly supported through company

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