2. Industry Overview
• Annual Revenue 462 Billion
• 2009-14 Growth: 3.5%
• 2014-19 Growth Projection:
2.1%
• Costco/Wal-Mart: account
for over 82% of market
share

3. Industry Performance
• Key External Drivers
• Per Capita Disposable
Income
• Corporate Profit
• Time spent on Leisure &
Sports
• Product Offerings
• Kirkland Brand

4. Industry Performance, Cont’d
Key External Drivers
(Cont’d)
• Competition
• World Price of Crude Oil
• Costco Gas
• Time spent on Leisure & Sports

5. Costco-Company Overview
• 451 Warehouses
• 67 Million Members
• Inventory: 3,600 items/store
• 2014: 79 Billion in Revenue (6.9% Increase)

6. Strengths
• Pricing Authority
• Consistently provide
competitive price
• Gasoline
• Lower cost, brings
members to warehouses
• Brand Loyalty
• High quality products
• Market share growth
• Increased customer base

7. Weaknesses
• Geographic Dependence
• U.S. & Canada: 87% of total
Sales in 2014
• California: 32% of U.S. sales
• Older Customer Base
• Baby Boomers
• Growing older, spending less

8. Opportunities
• Attract Younger Customers
• 19-34 Demographic
• E-Commerce
• Google Express & InstaCart
• Higher quality apparel
• Organic foods

9. Threats
• Competition
• Highly Competitive
• Sam’s
• BJ’s
• Non-Member Retailers
• Wal-Mart
• Target
• Internet Retail
• Amazon

10. Company Analysis
• Business Strategy
• Lower In-Store Inventory
• Focus on Higher End
Goods
• Slow Expansion
• Historical Value
• Stock Price (as of 4/24/15:
$148.12
• 1 year growth: 32.52%
• 5 year growth: 146.04%