Top Costco competitors in the world | Costco competitive advantage

This article covers the list of top Costco competitors in the world and also throws light on the Costco competitive advantage.

Company brief:

Costco is an American multinational corporation that operates a chain of membership-only warehouse clubs.

What are membership-only warehouse clubs? – Costco’s membership warehouse club is dedicated to offering it’s members the best possible prices on quality and brand-name merchandise.

In order to save money from shopping at Costco or to avail different rewards and benefits that the retailer offers, one needs to be its member.

There are different memberships that Costco offers to its customers

Gold membership
Business membership
Executive membership

Each membership plan comes with its own set of rewards and benefits. Users can purchase a membership online or visit the Costco store and buy the membership there.

Considered as one of the leading retailers in the world, Costco operates a total of 785 warehouses with 546 in the United States and Puerto Rico, 100 in Canada, 39 in Mexico, 29 in the United Kingdom, 26 in Japan, 16 in South Korea, 14 in Taiwan, 11 in Australia, two in Spain, one in Iceland, one in France, and one in China.

With such a wide presence, let’s check out the services that the company has to offer to its members:

Concierge service
Costco Auto program
Costco business services
Costco optical
Costco travel
Food service
Online photo site
Online shopping
Costco credit card

Costco’s Competitive advantage:

Before we get into knowing the top Costco Competitors, let”s first check out what is the Costco Competitive advantage:

Membership model: This is one model that Costco managed to crack pretty well. The membership model allows the user to become a member of Costco by paying a small fee. On becoming a Costco member, the customer gets to access all the discounts, rewards and benefits that the company has to offer on the products it sells.

You can’t save money shopping at Costco if you don’t join.

Costco does offer low prices, and joining, especially paying for the Executive Membership, is a good way to save money for many people.

Once the chain has a customer, it’s likely to hold onto him or her, because of the promise of what it offers, and the increased future savings it represents.

For a rival to compete with Costco, it would have to offer products for similar or less price that too without charging a membership fee.

This one simple strategy of Costco has been so successful that different other retailers implemented it in their business model as well.

Let’s check out the top Costco competitors that are giving the company a run for its money.

Top Costco Competitors:

WALMART:

The first on the list of Costco competitors is Walmart, the world’s largest brick-and-mortar discount retailer. Headquartered in Bentonville, Walmart operates a chain of Hypermarkets, discount stores, and grocery stores under 55 different names.

True to its core, the company offers everyday low prices to its customers and for this reason, is able to cater to a wide range of customer segments.

Walmart has maintained a proper mix of its offline and online growth strategy to sustain its leadership and ward off competition.

Apart from laying down aggressive e-commerce growth targets, Walmart is on a shopping spree acquiring companies like Flipkart, Hipster, Bonobos, and Modcloth to boost its e-commerce presence.

Its the strong emphasis of Walmart on both offline and online business strategy is what makes it one of the biggest Costco competitors.

CARREFOUR:

Its time to make way for the French multinational retailer, Carrefour. Headquartered in Boulogne Billancourt, France, the company has over 12,300 self-service shops and operates in over 30 countries Europe, the Americas, Asia, and Africa.

The main strength of Carrefour is adaptability, which is reflected in the online and offline strategy that it has adopted to outdo its competitors and to adapt to changing times and customer needs.

Carrefour distinguishes itself from discounters like Aldi and Lidl, by focusing on food quality and transparency. The company is investing heavily in Food-e-commerce and aims to have a 20% market share of France food e-commerce industry by 2020.

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TARGET:

The third in the list of Costco competitors is Target.

An American retail giant, Target is 8th largest retailer in the United States.

There are different retail formats that Target operate which include the discount store Target, the hypermarket SuperTarget, and “small-format” stores previously named CityTarget and TargetExpress before being consolidated under the Target branding.

KROGER:

Let’s talk about the United States’ largest supermarket by revenue ($121.16 billion for fiscal year 2019). Kroger is another American retail company that is the second largest retailer after Walmart and also the fifth largest retailer in the world.

The company operates, either directly or through its subsidiaries, 2,750 supermarkets and multi-department stores.

Different store formats that Kroger operates include :

Such wide presence of Kroger makes the brand as one of the main competitors of Costco.

SAMS CLUB:

Sam’s West, Inc. is an American chain of membership-only retail warehouse clubs owned and operated by Walmart Inc., founded in 1983 and named after Walmart founder Sam Walton.

As of January 31, 2019, Sam’s Club ranks second in sales volume among warehouse clubs with $57.839 billion in sales

Its major competitors are Costco Wholesale and BJ’s Wholesale Club.

As of April 30, 2020, Sam’s Club operates 599 membership warehouse clubs in the United States in 44 states, Puerto Rico and the U.S Virgin Islands.

This concludes the article on the top costco competitors.

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