BGuthrie Photos: UT -- Costco @ Salt Lake City

UT -- Costco @ Salt Lake City:

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Description of Pictures: In 2005, this store became the biggest Costco in the world.

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Copyrights: All pictures were taken by amateur photographer Bruce Guthrie (me!) who retains copyright on them. Free for non-commercial use with attribution. See the [Creative Commons] definition of what this means. "Photos (c) Bruce Guthrie" is fine for attribution. (Commercial use folks including AI scrapers can of course contact me.) Feel free to use in publications and pages with attribution but you don't have permission to sell the photos themselves. A free copy of any printed publication using any photographs is requested. Descriptive text, if any, is from a mixture of sources, quite frequently from signs at the location or from official web sites; copyrights, if any, are retained by their original owners.

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Wikipedia Description: Costco
From Wikipedia, the free encyclopedia

Costco Wholesale Corporation (NASDAQ: COST) is the largest membership warehouse club chain in the world based on sales volume, headquartered in Issaquah, Washington, United States, with its flagship warehouse in nearby Seattle. Costco's Canadian operations are based near Ottawa, Ontario, and Vancouver, British Columbia.

History:

Founded by James Sinegal and Jeffrey Brotman, Costco opened its first warehouse in Seattle, Washington on September 15, 1983. Sinegal had started in retailing by working for Sol Price at both FedMart and Price Club. Brotman, an attorney from an old Seattle retailing family, had also been involved in retailing from an early age.

In 1993, Costco merged with Price Club. Costco’s business model and size were similar to those of Price Club, which was founded by Sol and Robert Price in 1976 in San Diego, California. Thus, the combined company, PriceCostco, was effectively double the size of each of its parents. Just after the merger, PriceCostco had 206 locations generating $16 billion in annual sales. PriceCostco was initially led by executives from both companies, but then Sol and his son Robert Price founded Price Enterprises and left in 1994.

In 1997, the company changed its name to Costco Wholesale.

Costco today:

The main competitor in the membership warehouse space is Sam's Club. Although Sam's Club has more warehouses than Costco, Costco has higher total sales volume. Costco employs about 132,000 full- and part-time employees, including seasonal workers, and for fiscal year 2006, ended on September 3, 2006, the company's store sales totaled $60.2 billion of which $1.1 billion was net profit. Costco is #32 on the Fortune 500.

As of June 7, 2007, Costco has 511 locations: ...

Sales model:

Costco focuses on selling products at low prices, often at very high volume. These goods are usually bulk-packaged and marketed primarily to large families and businesses. Furthermore, Costco does not carry multiple brands or varieties where the item is substantially the same. This results in high volume of sales from single vendor, allowing further reduction in price, and reducing marketing costs. Costco also saves money by not stocking extra bags or packing materials; to carry out their goods, customers must bring their own bags or use the merchandise shipping boxes from the company's outside vendors.

Currently membership fees at Costco are $50 per year for Goldstar and Business Memberships, which can be upgraded to Executive membership for an additional $50 per year. Along with the additional benefits the executive membership has (e.g. car purchasing savings, home loans, car insurance, check printing services) executive members also receive an annual "2% Rewards Check" from Costco on all purchases made (excluding gasoline and tobacco).

Costco is only open to members and their guests, except for purchases of liquor and gasoline in some U.S. states due to state law; and prescription drugs due to federal law. Memberships must be purchased in advance for one year (as of May 5, 2007). Purchases made at Costco's website do not require a membership; however, a 5% surcharge is added to purchases made by non-members. Purchases made with Costco Cash Cards also do not require a membership, and there is no surcharge. To avoid credit card processing fees, United States Costco locations only accept American Express (not in the UK and only Samsung credit cards in South Korea), PIN-based debit cards (Interac in Canada), cash, and checks. Guests of members are not allowed to write checks.

Lighting costs are reduced on sunny days, as most Costco locations have several skylights. During the day, electronic light meters measure how much light is coming in the skylights and turn off an appropriate percentage of the interior lights. During a typical sunny day, it is very common for the center section of the warehouse to have no interior lights burning.

Most products are delivered to the store on shipping pallets, and the pallets are used to display products for sale on the retail floor. This contrasts with other retailers that break down pallets and stock individual products on shelves. Costco caps its profit margin on most products at 14% or 15%, but generally limits price markup on products from 8%-10%.

Costco Cash Cards:

Costco Cash Cards can be purchased in the warehouse and members can load them with money to make non-cash purchases at all Costco warehouses in the United States. Because Costco gas stations take only Costco Cash, debit cards, and American Express, people who normally pay for gas by check or cash must purchase a Costco Cash Card inside the actual Costco building before filling up.

Products:

Over the years, Costco has gradually expanded its range of products and services. Initially it preferred to sell only boxed products that could be dispensed by simply tearing the shrinkwrap off a pallet. It now sells many other products that are more difficult to handle, such as fresh produce, meat, dairy, seafood, fresh baked goods, flowers, clothing, books, software, home electronics, jewelry, art, hot tubs, and furniture. Many stores have tire garages, pharmacies, hearing aid centers, optometrists, photo processors, and gas stations.

Some locations have liquor stores, often kept separate in order to comply with liquor license restrictions. In some states (such as Texas), the liquor store must be owned and operated by a separate company with separate employees. In 2006, Costco won a court decision against the state of Washington allowing it to purchase wine directly from the producer, bypassing the state retail monopoly.

Costco also acts as an investment broker and travel agent. They have also introduced an automobile purchasing program where members can purchase new cars at specially arranged prices. They also have an agreement with Ameriprise for auto and home insurance.

In 2004 Costco offered a (single) original artwork by artist Pablo Picasso on their online store.

Kirkland Signature:

Kirkland Signature is Costco's store brand, otherwise known in the retail industry as an "own-brand." It is found exclusively at Costco stores and is trademarked by the company. The name derives from the fact that Costco's corporate headquarters were located in the city of Kirkland, Washington between 1987 and 1996.

To counteract the consumer confidence problem common in store branding, Kirkland Signature sometimes relies on Co-branding. According to Costco, while consumers may be wary of same-store-branding, they are less likely to be wary of brands that they are familiar with and trust.

Trivia:

* The very first Price Club location was an old airplane hangar, and is still in operation today (Warehouse #401 San Diego).
* The price of a kosher hot dog and a soft drink at the food court is still $1.50, the same as it was when (pre-merger) Costco first opened in 1983.
* Prior to the 1993 Price Club/Costco merger, Wal-Mart founder Sam Walton wanted to merge Sam's Club with Price Club.
* In 2006, former Buckingham Nicks drummer Gary Hodges and bassist Tom Moncrieff helped form a rock band named Sinai 48 after the Kosher Polish hotdogs sold in the Costco food court. The four member band consists of three members of Jewish descent.

Working at Costco:

While some former Price Club locations in California and the northeastern United States are staffed by Teamsters, the majority of Costco locations are not unionized. The non-union locations have revisions to their Costco Employee Agreement every three years concurrent with union contract ratifications in locations with collective bargaining agreements. Similar to a union contract, the Employee Agreement sets forth such things such as benefits, compensations, wages, disciplinary procedures, paid holidays, bonuses, and seniority. As of March 2007, non-supervisory hourly wages range from $11.00 to $19.50.

Product-demonstration (e.g., food samples) employees are employed by an outside company. In the western USA, the company is called Warehouse Demo Services, Kirkland WA. Costco also uses Club Demonstration Services, based in San Diego, California. .
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