With all of recent reports and stories about national retailers struggling financially, it had to be a good thing to be Costco. They recently reported that their quarterly profit of their online business was able to beat expectations. This is pretty amazing when you consider that they are in direct competition with Amazon and Walmart for online customers.
As the largest national chain membership, only retailer Costco does enjoy a unique position in that it offers its customer’s volume savings by selling much of its products in institutional size packaging in order to keep prices lower for its members.
With numbers of visitors walking through the doors at so many of the brick and mortar retail stores on the decline, it has forced so many of the large retailers to look to the Internet and put a big emphasis on their own presence. This is exactly what Costco did and it has apparently paid off in a huge way.
E-commerce business model made sense for Costco
Costco’s traditional membership only business model has been extremely successful for their brick and mortar chain of retail stores. However, as most people know there has been a big shift in the retail world and it involves the explosion of the Internet. Many of the traditional retail businesses are struggling because of Internet giant; Amazon.
In order to ensure that they were in a good financial position, Costco established an e-commerce presence on the Internet and soon discovered that their membership business model works for their brick and mortar business works really well with e-commerce on the Internet. As evident by their report of a positive quarterly profit number, that they have figured out that they could successfully compete online with the likes of the venerable Amazon and Walmart.
Costco is a rock solid investment
Costco, the Issaquah, Washington-based company is the largest membership-only retail business that was able to create an online e-commerce retail presence by enhancing their product offerings with valuable incentive programs. These incentive programs allowed Costco to position itself favorably again the online retail giant Amazon.
The combination of strong Internet sales and sales at their brick and mortar membership-only retail locations has out Costco in a much better financial footing. Which also makes them extremely popular with investors when their stock value continues to be very strong. These indicators of strong sales both online and offline speaks volumes and it would appear that they are in a much better position financially.