(Attached Below) Review Case 4: Costco Wholesale in 2016: Mission, Business Model, and Strategy Case Study in your textbook and the following videos
Answer the following:
1. What is Costcos business model? Is the companys business model appealing? Why or why not?
2. What are the chief elements of Costcos strategy? How good is the strategy?
3. Do you think Jim Sinegal was an effective CEO? What grades would you give him in leading the process of crafting and executing Costcos strategy? What support can you offer for these grades? How well is Craig Jelinek performing as Sinegals successor? Refer to Figure 2.1 in Chapter 2 in developing your answers.
4. What core values or business principles did Jim Sinegal stress at Costco?
5. (In the event you have covered Chapter 3) What is competition like in the North American wholesale club industry? Which of the five competitive forces is strongest and why? Use the information in Figures 3.4, 3.5, 3.6, 3.7, and 3.8 (and the related discussions in Chapter 3) to do a of
competition in the North American wholesale club industry.
6. How well is Costco performing from a financial perspective? Do some number-crunching using the data in case Exhibit 1 to support your answer. Use the financial ratios presented in Table 4.1 of Chapter 4 (pages 66-68) to help you diagnose Costcos financial performance.
7. Based on the data in case Exhibits 1 and 4, is Costcos financial performance superior to that at Sams Club and BJs Wholesale?
8. Does the data in case Exhibit 2 indicate that Costcos expansion outside the U.S. is financially successful?
Why or why not?
9. How well is Costco performing from a strategic perspective? Does Costco enjoy a competitive advantage over Sams Club? Over BJs Wholesale? If so, what is the nature of its competitive advantage? Does Costco
have a winning strategy? Why or why not?
10. Are Costcos prices too low? Why or why not?
11. What do you think of Costcos compensation practices? Does it surprise you that Costco employees apparently are rather well-compensated?
12. What recommendations would you make to Costco top management regarding how best to sustain the companys growth and improve its financial performance?
Part 2:
Using the financial ratios provided in Table 4.1 and the financial statement information presented below for Costco Wholesale Corporation.
Calculate the following ratios for Costco for both 2013 and 2014:
a. Gross profit marginb. Operating profit marginc. Net profit margin.d. Times interest earned coveragee. Return on shareholders equityf. Return on assetsg. Debt-to-equity ratioh. Days of inventoryi. Inventory turnover ratioj. Average collection periodWriting Requirements
APA format,4 pages in length (excluding cover page, abstract, and reference list)Research and cite and reference at least 3 peer reviewed journal article
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