When An Organization Fails, And How To Fix It

Running Head : ORGANIZATION FAILURE AND SOLUTION

When an Organization Fails , and How to Fix It

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When an Organization Fails , and How to Fix It

Do you want to shop till you drop and still get a lot of items from a little shopping allowance ? Do you want to see all the items that you need on shelves with the lowest price tag ? Then visiting the nearest Costco supermarket would be best for you . Costco Wholesale Corporation which was established in 1983

as a single store in Seattle , became the biggest membership warehouse club chain the world (Slatter , 2005 Costco realizes that business owners keep their personal credit card in the same wallet with their corporate credit card . That 's why Costco sells cashmere sweaters , expresso machines , high priced patio furniture and 40 ,000 diamonds . That 's also why Costco shoppers - who may be there to stock up on computer and printer cartridges - can find seafood and artisan breads as well as products from exclusive vendors like Titleist , Thomasville and Elizabeth Arden . In fact , Costco is now the nation 's largest seller of wine - those business customers turned out to be pretty good consumers as well ( What is Costco , 2005

Business owners are perfect personal consumers for Costco because they tend to be affluent and value-driven shoppers who love the hunt and the thrill of a bargain . The additional benefit for Costco has been that other affluent consumers flock to Costco thanks to word of mouth . It 's similar to Home Depot 's attraction : Many people want to shop at Home Depot because it 's where the professionals (the contractors ) shop . In some regards , business owners are professional consumers . Other consumers want to join the club - and shop where the professionals shop

Costco also has built up a great amount of integrity by staying true to its low-margin approach and refusing to sell items that can 't offer a demonstrable value . In addition to this , Costco emulates many of the same industry strategies as Wal-Mart 's SAM 's CLUB . Both initially targeted small businesses as their core constituency before expanding to individual consumers . They sell a limited number of goods in bulk quantities , use their huge volume to win better prices from suppliers and sell membership both to earn more income and to encourage loyalty (Marquard , 2007

Like Sam Walton , Costco founder Jim Sinegal remains obsessed with lowering prices . As a result , both SAM 'S CLUB and Costco use advanced systems to , ship and distribute products . They both press suppliers for the lowest possible cost . Cardinal rules number one at Costco is limiting the markup on products to 15 percent - compared with the supermarket convention of 25 percent and department store practice of 50 percent or more (Greenhouse , 2005

Costco demonstrates how a big competitor in an industry with one dominant player can win its own place in the market by taking a somewhat different approach . To keep its cost structure...