Costco case analysis until 2008 Essay Example | Topics and Well Written Essays - 500 words

Costco case analysis until 2008 - Essay ExampleThis is the originator why it is not charging credit cards because current low gear margins do not cover this fee. Costco fecal matter solve this problem by using both the cash and credit card system of payment, just now those people who want to pay using credit cards, an extra 2% should be charged to their bills in the lieu of banking fee. This method will be acceptable to most of the customers as the prices in Costco are already very low and people who use credit card can still make a saving even if they pay for extra 2 percent banking fee. This will help Costco attract a wider customer base and at the same time not lose out on their margins. Costco has as well as limited itself in the membership program. Special offers and rabbets are given only to members of Costco. This is a dangerous constitution because many potential customers who want to avail special offer cannot avail them and hence they do not shop at Costco. What Cost co can do here is that they should publish and send out special discount coupons through direct mail and magazines. These coupons should be redeemable at Costco stores and this way Costco will serve a wider audience and will be able to attract larger pool of prospective customers.Many separate shops and competitors to Costco provide ancillary services to its customers. However, Costco does not provide these services to its customers. Costco is operating at very low margin which does not give enough leverage to Costco to provide these services. This can be tackled by Costco ad that should compare its costs with other retailers and should point out that Costco is competing on cost and the value of saving that Costco provides is great than ancillary services that other retailers provide. This will encourage many more customers to buy from Costco and it will besides help to increase Costcos sales and revenue.It can be concluded from the above discussion that although Costco is doing handsome well, it needs to look at the external environment and should