Case Study 1
The case study assignment for Module 1 draws on the following case study in your textbook:
Case 4: Costco Wholesale in 2016: Mission, Business Model, and Strategy, by Arthur A. Thompson (page C-26)
Read the case and then respond to the case questions provided below. (See Guide to Case Analysis for further guidance on writing a case analysis.)
In addition to reading the case study provided in the textbook, research the company further to find any relevant events that have transpired since the writing of the case study. Use the company's website, Internet search engines such as Google, online data services, or other sources to locate the latest articles about the company including press releases and current financial information. Be sure to cite all sources according to APA guidelines.
Note: For assistance with analyzing any financial data in this case, Table 4-1 (Key Financial Ratios: How to Calculate Them and What They Mean) in your textbook is a useful reference.
Please limit your analysis to 4 pages (1000 to 1100 words), double-spaced.
Case Questions
- Costco’s pricing strategy seems to be largely misaligned to customary business practices. Select one element of this strategy and detail the impact of that strategy has upon the business, operational and/or procedural practices of Costco.
- Does Costco enjoy a competitive advantage over BJ’s Wholesale? If so, what is the nature of its competitive advantage? Does Costco have a winning strategy? Support your answer.
- For any set of organizational strategies, goals, and objectives to have a chance of success there must be pervasive support by/from the organizational culture. Which of the specific practices, et al., of Costco do you feel has the most direct influence on its business culture? Explain the foundation for your response. Is the nature of that influence positive or negative for Costco’s organizational culture? Support your position.
- Costco’s expanded mission statement, as related in the Company’s 2011 Annual Report, discusses the goal of remaining environmental stewards in their operations around the world. How effective have been Costco’s efforts in establishing and maintaining such environmental sustainability?
- Which revenue stream do you think is most important to the Costco business model and strategy? Provide details of your selection as well as the rationale for your choice.
Sample Solution