A tutorial consisting of five pages discusses Costco's distribution and marketing channels in an assessment of its philosophy of distribution, inventory, and customer base with improvement recommendations also provided. Three sources are cited in the bibliography.
Name of Research Paper File: D0_MTcostco.rtf
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help of joint ventures, overseas. What will be examined in this essay is an examination and comment about the current state of the companys distribution channel - in other words,
how it is able to learn what the customers want, and how it is able to then turn around and get the product to market in a quick and timely
fashion. This tutorial will advise the student on what information is available to assist in this topic, and how such information
can be presented. In examining the companys distribution channel, the student first needs to focus on the companys retail style. Costco is
what is known as a "warehouse club retailer," in other words, a company that places all of its products for sale, in bulk, in a huge warehouse box, rather than
a typical retailer, which would have single items for sale, typically placed on shelves. The company the recruits "members" i.e., consumers, who pay a fee to the company in order
to obtain name-brand products at low prices. Companies such as Costco are able to pass on such savings to consumers because the company is able to obtain products at "rock-bottom
prices" (Blumenthal, 1999). Costco, overall, has a reputation of providing quality goods and extraordinarily low prices - with low profit margins
for the company (Ferguson, 1997). Comparing Costco to Wal-Mart (which runs Sams, another warehouse club retailer) demonstrates that Costco prices its merchandise very close to cost (Ferguson, 1997). Costco customers,
in a sense, are paying for the merchandise, rather than the overhead (Ferguson, 1997). One of the reasons why Costco has been