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Strategic Analysis Fnl

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1. DESCRIPTION OF THE COMPANY: COSTCO WHOLESALE CORP. 3
Short history 3
Key facts and figures of today’s business 3
2. PESTEL: 6
2.1.1. Political and legal : 6
2.1.2. Economical: 6
2.1.3. Sociological: 7
2.1.4. Technological: 7
2.1.5. Ecological: 7
3. Industry analysis 8
3.1.1. Industry Rivalry—Strong Competition 9
3.1.2. Threat of Entry- Weak competitive force 9
3.1.3. Power of supplier—Weak competitive force. 9
3.1.4. Buyer’s (Customers) Power—a weak competitive force 9
3.1.5. Threats of Substitutes—a strong competitive force 10
4. From Resources & Capabilities to the firm’s STRATEGy and competitive advantage 10
Resources & capabilities analysis 10
4.1.1. CostCo’s resource assessment 10
4.1.2. CostCo’s capability assessment 12
Nature of the firm’s strategy and competitive advantage 12
Strategic coherence of the firm’s choices 13

1. DESCRIPTION OF THE COMPANY: COSTCO WHOLESALE CORP.
Costco Wholesale Corporation evolves in the consumer goods distribution industry. Thanks to a membership system, Costco is more than just a hypermarket; it is a wholesaler supplying goods at a low price to its member only.
Indeed, it defines itself as a “membership warehouse club dedicating to bringing our members the best prices on quality brand-name merchandise”1.
Short history
The history of Costco began in 1976 with the launch of a warehouse in San Diego by The Price Company. At that time, it was only serving small businesses and was considered only as an intermediary between goods producers and shops. Quickly after the opening, it decided also to distribute its goods to selected non – business members to expand faster and greater. Pioneer in this concept, it was immediately successful.

In 1983, under the supervision of James Sinegal and Jeffrey H. Brotman, Costco opened its first warehouse club in Seattle and 10 years later both The Price Company and Costco merged to become Price/Costco Inc. and relocated in Delaware, United States. At that time and

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