Why Is Costco So Damn Addictive By Matthew Boyle

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Why Is Costco So Damn Addictive?By Matthew Boyle
Brandi Tiffiny Jeff
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Jim Sinegal one of the top entrepreneurs in the
US creates THE TREASURE HUNT

• We always look to see how much of a gulf we can
  create between ourselves and the competitors. So
  the competitors eventually say, F em, these
  guys are crazy! Well compete somewhere else.

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Competitors

• Wal-mart

• Target

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What do they do?

• Ridiculously priced, high quality products
• Low markups
• No bags, no advertising
• Membership costs - 1.1billion
• They pay us to shop here because everyone loves
  a bargain
• Pay employees well, CEO only makes 450,000

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Intelligent Loss of Sales

• Limited variety approach 325 count bottle of
  Advil
• Lots of people dont want to buy that much but
  since its the only one, most will
• Store efficiency

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Efficient product sourcing

• Managers are entrepreneurs
• Costco Mini-corporation - 300M each
• The Costco Experience

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Iconoclastic ApproachGreek for Image Breaking

• Counterintuitive approach to retail
• If a retailer is selling it for 10, I think,
  How can I sell it for 9?
• Ranked 29th in Fortune 500 in size based on sales
• BJs Wholesale only reached 291st

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References
Boyle, Matthew. "Why is Costco So Damn
Addictive." (2006) Kimmel Goes to Costco. Perf.
Jimmy Kimmel. clip. Youtube. http//www.youtube.co
m/watch?v3LR7ZhdGXXg Gamble, John, and
Thompson, Arthur. Essentials of Strategic
Management. McGraw Hill