Walmart vs Costco

Walmart vs Costco

Introduction

With $401.2 billion revenues, the retailing giant, Wal-Mart, has been ranked as the 2nd place of 2009 Fortune 500 companies. This company is seen as the most successful business in the world today but also viewed as the vital indicator to observe the status of financial crisis recovery. Wal-Mart has won market share during the recession by offering customers lower prices as its successful marketing strategy. Moreover, Wal-Mart is long for expanding its kingdom all over the world. In 2005, Taiwan once was one of Wal-mart's plans to join the overseas expansion, nevertheless, Wal-mart veered round to China at the last minute.

Instead, the Costco (24th place of 2009 Fortune 500) with 71.4 billion revenues completed Wal-Mart's work and entered the hyper market of U.S. The differences between Wal-Mart and Costco provide an interesting study in contrast going today. Moreover, the key elements of success of those two retailing giants are also will be the highly concerned for retailing filed.

Discussion

In 1976 Price Club was founded in San Diego, California. A year before their business reached over $1 billion dollars in sales, Costco opened its first warehouse in Seattle, Washington. In 1986 Price Club had 22 locations and 3.2 million members while Costco had 17 locations and 1.3 million members. In 1993 these two companies formed under a merger, but it wasn't until 1997 that they changed their name from PriceCostco to Costco Companies Inc.

Costco's mission is to offer quality, brand name products at a substantially lower rate than their competitors. Although Costco targets small-to-medium-sized businesses in large cities throughout the world to help reduce costs in purchasing for resale and for everyday business use, they also sell to customers for their personal needs. Businesses and large families are Costco's greatest customers.

Walmart is the American multinational chain of discount and warehouse stores. It is the largest corporations in the world in terms of revenue. Walmart is involved in grocery and general merchandising retailing (Barbaro, 2007). In terms of revenue, it ranks as the second largest retailer in the world. Walmart is the largest employer in the world and serves in fifteen countries through its over 2 million employees and 8500 stores. The first retail store was opened in the year 1962 from 1990 sales went up for more than $25 billion to more than $374 billion in 2007. Wal-Mart has 979 stores, 2435 supercenters, 586 Sam's Clubs and 128 neighborhood markets. That sums up to over 4000 retail units in the United States. Also Wal-Mart play important role in 3000 retail units outside the United States. Exciting detail regarding to the company's operating cost is that they are low at about 16% in recent years. Wal-Mart is cautious to offer each associate with the technological tools needed to work smarter. In 1997, Wal-Mart was recognized by Computerworld and Smithsonian Magazine as one of the top five innovators in information technology.

To compare the different business style & Market size between Wal-Mart & Costco.

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