Costco Wholesale in 2012 Essay Example for Free

Costco Wholesale in 2012 Essay Costco is one of United States’ largest retailers, serving over 3600 variants of convenience products at excellent quality with competent prices. Founded in 1983, Costco quickly expanded in its operations to over 598 stores worldwide. One of the unique selling propositions of Costco is the fact that they offer very low prices as compared to their competitors without requiring to compromise quality. This paper will analyze Costco’s key success factors in terms of its strategic management. Business Model Costco’s business model is simple and straightforward; they offer high quality products at affordable rates. The centerpiece of Costco’s model entails high sales volume and rapid inventory turnover. Costco enjoys high inventory turnover which means that they don’t need to stock a particular good for long period of time. Also, before they need to pay the suppliers, they are able to sell it. Which means, they are able to pay suppliers with the cash derived from sales, leading to low working capital. This shows significance in financial health and good financial management. This kind of business model is appealing for several reasons; low prices can generate high number of customers, indicates healthy operations, encourage rapid turnover, decrease warehouse costs and many more. However, in order to keep up with this business model, Costco needs to continually maintain overhead costs, which will be discussed further into the paper. Strategy Costco’s low pricing strategy highly depends upon several factors. In terms of pricing, they offer bargain products at low prices. Their earnings highly come from membership fees, over which members can join in an annual subscription and enjoy promotional rates as members. Even though Costco enjoys less profit margins, they have high number of annual members and earn their profit by membership revenues. In terms of product, their Kirkland Signature is also of good quality as a representation of their brand. They are also ready to experience loss of sales by customers who do not want to purchase in larger quantities. Treasure-hunt merchandising is also a smart  method to continually renew their product lines to encourage members to purchase the item right away in fear of not having them available at the next visit. Jim Sinegal and Core Values as CEO Jim Sinegal shows good examples of leadership as a CEO. He conducts an open-door policy which makes him accessible to staff, thereby increasing employee motivation. Jim also conducts regular store visits as opposed to working at a desk, which shows his willingness to step down to the field to help improve the store. The business environment is made to be causal and unpretentious, so employees feel sense of belonging and are often committed to the organization, in benefit of themselves and the company. Low employee turnover shows the compatibility of the employees and the company, which means that the corporate culture can be maintained or enhanced. Financial Perspective We have come to understand that Costco achieves much of their revenue from membership renewals. Observing the financial data, we see that Costco’s membership fees if four times over from 2000 up to 2011. This signifies their proficiency in making member packages attractive. Their actions in prioritizing members have been successful as we see that members are continually signing up. Therefore, membership is encouraged to be sustained. However, we see that sales also increase significantly over the years, almost 3 times over. Therefore, we can conclude that despite having less marketing activities, Costco is able to attract customers by emphasizing on price efficiency. Their working capital ration (current assets minus current liabilities) is kept at a low level due to high inventory turnover. Competitive Advantage over Competitors A key competitive advantage owned by Costco over its competitors is, without a doubt, their low prices. Although they do not invest much in store layout, store ambiance, labor and marketing, they have low overhead costs which contributes to being able to keep prices low. Also, they offer a wide array of product categories from food products to gasoline, although within a product category, they offer less brands than usual retailers (Llopis, 2011). Strategic Weaknesses in Comparison to Competitors The fact that Costco carries only 3600 selections of merchandises could potentially be a major flaw in their strategy. Generally, other stores carry over 10.000 selections. Customers may initially feel the thrill of shopping at cheap prices at Costco but could eventually dislike the lack of choices in terms of brands and may choose to shop at stores with larger varieties. Secondly, Costco spend less for advertisements and rely on word-of-mouth and certain campaigns. However, their competitors, Sam’s Club and BJ’s Wholesale Club spend much more on advertisements. Presently, Costco’s financial conditions show steady results in sales but the power of marketing is such that customers may choose to shop elsewhere for various reasons. It is also important to note that customers’ switching costs (from Costco to another) is relatively low. Compensations Policies Costco offers attractive compensations as compared to their competitors. The employee benefits covers all aspects such as fixed wages, health benefits, medicinal discounts, eligibility for company profits, counseling services and many more. At a quick glance, we notice that Costco spends much on compensation, despite the comparatively lower amount of labor, due to the vast varieties of compensations. In my opinion, it shows good corporate culture to take care of employees. In most companies, CEOs are the first ones to be rewarded with sky-high numbers. It is different in the case with Costco, where CEOs are paid enough without failing to reward employees appropriately. Conclusions and Recommendations Although from a management and operation point of view, Costco is doing everything to a tee, there are several recommendations provided to further improve its performance: Increase product lines to above 3600 in order to compete in terms of product choice with their competitors, especially after understanding that customers’ switching costs are low. Costco already has a big advantage in terms of prices and can do wonders when they also hold product advantage. Prepare some funds for marketing. Branding and brand awareness are two of the most important factors for warehouses to remain sustainable in the market to be seen as reliant. With more marketing, Costco can retain top-of-mind positioning as the â€Å"place to shop† in customers’ mindsets. Maintain membership fees at a fair rate. Currently, Costco’s membership fees are higher compared to their competitors. They can maintain their fees at this level only if they can provide more attractive member benefits to their customers compared to their competitors. Reference: Llopis, G. (2011, January 31). The Costco Factor: To Win The Business Game, You Need to Change How You Think. Retrieved February 20, 2015, from Forbes: http://www.forbes.com/sites/glennllopis/2011/01/31/the-costco-factor-to-win-the-business-game-you-need-to-change-how-you-think/

Of Mice and Men :: essays research papers

The title of the book is Of Mice and Men. The author is John Steinbeck. It was published by the Penguin Group in New York, New York. The copyright date is 1965. Of Mice and Men is a novel about two men, one named George and one named Lennie. George somewhat takes care of Lennie. As the book opens they are walking along the bank of the Salinas River. They are one the way to a nearby ranch to sign on as barley bucks. Slow-minded Lennie had cost them their previous job. They are trying to earn money so they will be able to own their own ranch someday. Lennie has an obsession with petting small animals especially rabbits. George tells Lennie that he if he gets in any trouble he wont be able to tend the rabbits at the farm. George uses this as a bribe to keep Lennie out of trouble. Once they were hired, both George and Lennie went right to work. Later, as they waited for lunch to be served, Curley walked in, the ranch owner's son. He was there to look over the new men. After Curley had gone, Candy, the bunkhouse swamper, warned them about the young man. A former prizefighter, Curley tried to show how much of a man he was by picking on others. He was also an insecure husband, he became insanely jealous of anyone who even got near his wife. Seeming to sense that Curley would bring them trouble, Lennie now became agitated and nervous about the job, but with no money to fall back on, the pair was forced to continue working at the ranch in order to make enough money for their dream farm. On the third day at the ranch Lennie was in the farm playing with a puppy that Slim, another worker at the ranch, had given him. The rest of the men were in town. While he was in the barn Curley’s wife walked in. She began to show him how soft her hair was because he seemed to like the soft feel of the dog. He began to touch her hair and he couldn’t let go. She began to struggle and soon after she suffocated and died. After he realizd she was dead he panicked. He covered her body with some hay and then ran and hid in the brush like George had told him to do if he got in any trouble.

A fear of democracy runs throughout liberalism Essay

The relationship between Liberalism and democracy can summed up by Winston Churchill’s famous remark, â€Å"†¦democracy is the worst form of Government except all those other forms†¦Ã¢â‚¬  A fear of democracy does runs throughout 19th centrury liberals due to many reasons, one of them being their fear of collective power. On the other hand by the 20th century Democracy became more accepted in liberalism and the fear of democracy no longer remained. Plato and Aristotle viewed democracy as a â€Å"chaotic rule of masses at the expense of wisdom and property†. Nineteenth century liberals agreed with this idea as they saw democracy as dangerous and feared it. They were concerned that democracy could threaten individual liberty. Democracy is necessarily collectivist, in that it places political authority in the hands of the people who are not a single entity but are turned into a collection of individuals or groups. This contradicts the liberal principle of individuality and atomistic society. Therefore this might lead in the interests of individual citizens being ignored. In society people have different opinions and opposing interests often resulting to political instability and conflict. The democratic solution to this conflict is the application of the majority rule; the principle that the will of the majority should prevail over that of the minority. Mill feared the unintended consequences of the rule of masses. Therefore nineteenth century liberals feared the negative repercussions of democracy such as the tyranny of the majority as the principle of the majority rule can result into the suppression of individual freedom and minority rights. Majoritarianism can not only ignore the interests of the minority but it can also create a culture of dull conformism, where people according to Mill become â€Å"transformed into mere industrious sheep as they defer to the judgments of the majority based on the unfounded assumption that the majority is always right.† Therefore Mill is trying to say that democracy supresses originality and individuality. However nineteenth century liberals have expressed reservations about democracy not just because of the danger of majority rule but also because of the composition of the majority in modern industrial societies. The liberal theory of utilitarianism and equality led to an abundance for the  few but subsistence for the many and while in theory it is happiness that is maximised, in practice it is wealth. Therefore if society is deeply divided, majoritarianism would expose the rich to a tyranny of the poor. J.S Mill believed that political wisdom is unequally distributed and largely related to education. The uneducated poor are more likely to act according to narrow class interests so for them to have the majority would be disastrous. Mill argued that the educated can use their wisdom and experience for the good of others. Therefore he believed elected politicians should speak for themselves rather than reflect the views of their electors and suggested a system of plural voting that would deprive the illiterate from power . This argument shows a view against representative government which is a key feature of democracy. Fears of tyranny of majority by the uneducated poor as a result of the arrival of mass democracy which result into the destruction of a civilized society and moral order are also expressed by Gasset. As well as this liberals feared excessive democracy because democratic systems that widen access to political influence tend to be characterized by growth in interventionism and the problem of over-government. Such intervention may weaken the efficiency of market capitalism and therefore contradict early liberals belief that the market should be free from government interference. As a result excessive democracy may disadvantage the mass of citizens in the long run. By the twentieth century, however, many liberals had come to see democracy as a virtue. Democracy broadens and deepens popular participation. According to Mill the most important advantage of democracy is that it promotes the highest and most harmonious development of human capacities. It is true to say that democracy stimulates civil participation in the political decision-making process creating a better-informed and politically sophisticated citizenry. Consequently Rousseau and Mill claimed that in the absence of democracy ignorance and brutality will prevail. Modern liberals have come to understand that democracy has educational benefits as citizens enhance their understanding and achieve a higher level of personal development. Democracy therefore takes a developmental form in the twentieth century. In addition democracy defends freedom by allowing citizens to protect themselves against tyrannical governments and unpopular policies. In the seventeenth century classical liberals such as Locke argued that voting rights should be extended to the propertied who could then defend their natural rights against government. Jeremy Bentham and James Mill , nineteenth century liberals developed the notion of democracy as a form of protection for the individual into a case of universal suffrage. This meant that individuals would vote to defend their interests and that is the only way of promoting the greatest happiness of the greatest number. However as time went by Locke’s theory of protective democracy has been transformed into a developmental view of democracy. For example a greater sympathy for universal suffrage is shown by James’s Mill son John who argues for the empowerment of women and against the plight of workers, showing he had moved from a protective to a developmental view of democracy. Since the twentieth century liberal theories about democracy have tended to focus less on consent and participation and more on the need for consensus in society. Pluralist theorists have argued that organized groups not individuals play the most important role in the politics of increasing complex modern societies which are characterized by competition amongst rival interests. Therefore democracy has the benefit that, in giving a political voice to all competing groups and interests in society it binds them to the political system and tends to promote consensus thereby maintaining balance and political stability within modern societies. Therefore in conclusion nineteenth century liberals mostly feared democracy but as time went by liberals of the twentieth century came to recognize its benefits .Even though there are conflicting ideas within liberalism and democracy, the liberal acceptance of universal suffrage, the key feature of democracy, has led to an acceptance to all the elements of democracy including majority rule and representative government. This is because liberals were able to create solutions to prevent the extremes of democracy .This can be seen with the example of majoritarianism when the liberal element of checks and balances prevents the tyranny of the majority.

Behaviorism Behaviorism And Behaviorism - 847 Words

Behaviorism When individuals hear the term Behaviorism today, they instantly know that it signifies some form of behavior considering that it is in the word itself. Nevertheless, what exactly is behaviorism? According to the Dictionary of Psychology, behaviorism is a theory of learning that is based upon the idea that all behaviors are obtained from outside observations and not in thoughts or feelings. In the twentieth century, three significant behaviorists John B. Watson, Ivan Pavlov and B.F. Skinner determined that behaviorism is the study of observable behavior, as opposed to internal events such as emotions and cogitation (Moore). Although the three behaviorists encounter their theories of behaviorism differently, their ideas are similar. Behaviorism is the study of human behavior and is principally based on the belief that all human behavior is learned through conditioning of the environment. First, in the Encyclopedia of Psychology it states that many historians of psychology who were aware of Watson’s achievements, acknowledge him to be the â€Å"founder† of behaviorism. In the Encyclopedia of Psychology is also declares that behaviorism back tracks to the twentieth century when several behaviorists were interested in clarifying what behaviorism actually was. Not only was Watson admired for being the founder of behaviorism, but compared to the other two behaviorists he performed experiments on humans. Behaviorism in the nineteenth century was known to have beenShow MoreRelatedSignificance Of Behaviorism And Behaviorism Essay925 Words   |  4 PagesSignificance of Behaviorism A rebellion against structuralism and functionalism began in 1913 with what was known as Behaviorism. This revolution was initiated by John B Watson in 1878 to 1958 (Ettinger, Reed, 2013). 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