Nobody downloaded yet

Costco's Five Forces Analysis - Essay Example

Comments (0) Cite this document
In the study, the five forces analysis of the company has been evaluated in order to determine its competitive advantage within the market.  Through the analysis of Porter’s five forces, the competitive advantage of the company has been determined…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER94.8% of users find it useful
Costcos Five Forces Analysis
Read TextPreview

Extract of sample
"Costco's Five Forces Analysis"

Download file to see previous pages The focus in this paper is on Costco Wholesale Corporation (CWC) that operates a series of ‘cash & carry membership warehouses’ that trade high-quality, domestically branded as well as privately labeled merchandises at a low price range. It sells the products to businesses that purchase for the purpose of commercial use and also to the individuals as selected member groups. The business of the company is depended on the attainment of high sales volume along with inventory turnover by providing various ranges of products at low price. Costco Wholesale Corporation receives bulk purchase based inquiries from domestic as well as international markets in large volumes. Costco Wholesale Corporation possesses widespread worldwide buying power and it endeavors to satisfy any specific item related requirements beyond its everyday assortment. The innovative concept regarding warehouse retail has enabled the Costco Wholesale Corporation (CWC) to make vertical integration and provide the products from manufacturers towards consumers. Porter Five Forces analysis facilitates to establish the strength of competition, profitability as well as the attractiveness of a company in the marketplace where it is operating. The five competitive forces that generate the framework of market and industry are ‘bargaining power of supplier’, ‘bargaining power of customers’, ‘threats of new entrants’, ‘threat of substitutes’ and ‘competitive rivalry between existing players’....
The other significant issue is the extreme focus related to capital, as type of inventories as well as warehouse facilities make it difficult for a firm to exist. Another noteworthy issue is that the retailers of warehouse strive to maintain brand loyalty and this effort is unique in comparison to usual customer loyalty based campaigns. In this aspect, Costco has captured the lead by means of proliferation related to tangible products as well as services (George et. al., 2004, pp. 8). Threat of New Entrants The threat of new entrants is low as there is high obstruction of entry in the market due to intense competition of Costco and its competitors. The new entrants may face enormous cost due to the inbuilt capital strength of the company. Costco already has developed good affiliation with suppliers as well as customers thus it would be a challenge for a new company to operate in the new market. Therefore, for Costco new entries are not a matter of great concern. The new entry may be important for two reasons: if the existing store in the market launches a product with greater expediency and low cost and if the competitors such as Target or Wal-Mart introduce warehouse retail chain with their capital resources. However, such situations have not occurred, as a result, for Costco the threat of new entrants has not become a major issue (George et. al., 2004, pp. 8). Threat of Substitute Products The threat of substitute of new products is considered to be low because the substitute of Costco’s multi product offerings is not available in the market. There is presence of substitutes of the products of Costco when there is disaggregation of the products across sub-industry parts. The mattress ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
(“Costco's Five Forces Analysis Essay Example | Topics and Well Written Essays - 1000 words”, n.d.)
Retrieved from
(Costco'S Five Forces Analysis Essay Example | Topics and Well Written Essays - 1000 Words)
“Costco'S Five Forces Analysis Essay Example | Topics and Well Written Essays - 1000 Words”, n.d.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document
Porter's Five Forces Model
...? Porter's five forces model Introduction Michael Porter has formulated his famous five forces theory for determining the competitive power of an organization, while he was working as a professor in Harvard University in the 1970’s and 80’s. He has redefined all the traditional business theories and introduced new benchmarks such as potential entrants, supplier power, industry rivalry, buyer power and threats from substitute products for determining the strengths and weaknesses of an organization. Majority of modern organizations are currently using Porter’s five forces theory to determine their...
5 Pages(1250 words)Essay
Porter's Five Forces Analises
...? Porter’s Five Force Analysis Table of Contents Introduction 3 Discussion 3 Industry Rivalry 3 Threat of New Entrants 4 Threat of Substitutes 4 Bargaining Power of Buyers 5 Bargaining Power of Suppliers 6 Conclusion 6 References 7 Introduction Porter Five Force analysis is an important framework for business strategy development and industry analysis. This strategic analysis tool helps an organization to develop strategy according to the competitive business environment within the industry. Specifically, organizations determine the competitive factors within the industry that enhance their strategy development process (Ahlstrom and Bruton, 2009, p.131). This essay will implement porter’s five force model to conduct an analysis... of the...
4 Pages(1000 words)Essay
Porter's Five Forces Model
...Introduction Porter's Five Forces Model is applied in the analysis of industry and corporate strategy. His Five Forces framework utilizes such conceptual approaches as the development of an industrially organized system of economics so that the five forces can be utilized to decide the extent of competition and thus the relative appeal of a market. It's feasible to consider the degree of attractiveness here. In fact it's this particular characteristic that determines the level of industry profits. Thus the opposite is true when unattractive industries incur losses as in the case of those industries that constantly...
9 Pages(2250 words)Essay
The Five Porter Forces
...The Five Porter Forces The Porter five forces provide an analysis on which a company should base the production techniques and shows a balance of forces that determine the profitability of an industry. For a firm to ensure maximum profits there is need to use the model to understand the industry context so as to develop an edge over the immediate rivals. The underlying five forces that were given by Porter include the supplier power, buyer power, threat of substitutes, rivalry and entry barriers or threats of new entrants to a market (Greenwald & Kahn 57). Michael Porter has provided that firms can...
2 Pages(500 words)Essay
Analysis of Five Forces Model
...Resources and Sustained Competitive Advantage. Journal of Management, 17(1), pp. 99-120. Foss, N., 1998. The Resource-Based Perspective: An Assessment and Diagnosis of Problems. Scandinavian Journal of Management, 14(3), pp. 133-149. Henry, A., 2011. Understanding strategic management. Oxford: Oxford University Press. Krishnamurthy, B. V., 2010. Five Forces Model: Analysis from an Emerging Economy. [pdf] Available at: <> [Accessed 5 May 2014]. Porter, M., 1991. Towards a dynamic theory of strategy. Strategic Management Journal, 12, pp. 95-117. Priem, R. and Butler, J., 2001. Is the resource-based “view” a useful...
4 Pages(1000 words)Essay
Porters five forces analysis - Beats by Dre
...Beats by Dre: PORTERS FIVE FORCES ANALYSIS BY Beats by Dre Table of Content Executive Summary/ Introduction 2. Description of Porters Five Forces Analysis a. Purpose b. Benefit to Business 3. Porter’s Five Forces Analysis on Premium Headphones Markets 4. Company Marketing Strategies 5. Ansoff Growth Matrix a. Purpose and Benefits 6. Strategies Adopted by the Business 7. Conclusion Beats by Dre Introduction The company that manufactures these headphones was formally incorporated in 2008. The founder of this company was Dr. Dre, who established it as a family business. The...
8 Pages(2000 words)Essay
Michael Porters Five Forces Analysis
...Porter Five Forces of Competitive Position Analysis Michael E. Porter developed the five forces of competitive position in the year 1979. The framework is used for evaluating and assessing the competitive strength and position of a business firm. The theory is based on the concept that the forces determine the attractiveness and competitive intensity of a market. The forces help in identification of the power of a business situation. The analysis is used to understand the strength of the firm’s current competitive position and the position’s strength (Boone and David, 45). Strategic analysts of a firm...
4 Pages(1000 words)Coursework
Fr, Michael Porters Five Forces Analysis
...Porter 5 forces analysis Part A Porter five forces analysis is a framework that is usually used for the purposes of analyzing the level of competition within an industry. The analysis can also be used for the purposes of developing the business strategies. The framework is comprised of five forces that are useful in determining the level of rivalry as well as the attractiveness in a particular industry. The five forces that are used during the process of carrying out the analysis includes bargaining powers of suppliers, industry rivalry, threat of new entrants, bargaining powers of buyers and threat of substitutes (Porter, 2011). The forces have been referred to a microenvironment in the framework. The businesses have to reassess... the...
4 Pages(1000 words)Coursework
Boeing Porter's Five Forces Industry analysis
...industry is characterized by low profits, and issues of bankruptcies and losses (Hecker, 2001). In fact scholar explains that it is always difficult for an airline company to make some profits, because of this high level of competition (Fojt, 2006). The five biggest companies operating in United States are, American Airlines, Delta, South West, US Airways, and United Airlines. These companies are providing very high competition to companies such as Boeing and Air bus (Peoples, 2012). However, because of the similar strategies that they use, there is no major market leader in this industry. All these airline companies have to compete for a share in their market under consideration. Because of high competition in this...
2 Pages(500 words)Assignment
Five Forces Analysis of the Hospitality Industry
...Industry Analysis College Industry Analysis Five Forces Analysis of the Hospitality Industry Rivalry among Existing Firms The hospitality industry has many players, explaining why there is increased rivalry between the firms. There is a remarkably slow growth of tourists’ demands, a factor that compels many hotels and restaurants to compete rigorously. Revenues from the hospitality industry depend on customer traffic, and only players that have gained competitive advantage can survive the increasing competition. In the case of Mamas on Washington Square, gaining competitive advantage has been the main priority (Adams, 2006). Notably, Mama’s needs to...
5 Pages(1250 words)Research Paper
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Let us find you another Essay on topic Costco's Five Forces Analysis for FREE!
logo footer
Contact us:
Contact Us Now
FREE Mobile Apps:
  • StudentShare App Store
  • StudentShare Google play
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • Miscellaneous
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us