What do we have in common or not?----------------------------------------------

About Costco :

Membership Fee for Purchasing of goods. Consumers are not Subscribing for Goods, but actually they are subscribing for Services. They are selling at less margins to maintain Capped Margins. Maximum, on all products the average margin in an year is 11-12% For maintaining average margin, they have their own brands, where in that brands the margins are much higher than their average margin. These higher margins of own brands will be compensated with lower margins of other brands to maintain average margin. They don't offer lower prices only on weekends or on some other days, they continuously offer discounts throughout the year on most of the products. High Employee wages - This allows employees to do more productive work rather than lazy. Fewer Stock Keeping units - They have only limits brands in all segments, say only one or two brands in toothpaste. This allows them to gain higher margin as the brand-owners wants their product to be in store. About Walmart:

Targeted both Wholesale and Retail Consumers. They are using technology in a better way. This allows them for online sales high when compared with Costco. Everyday Low prices - Mostly all the time they are offering discounts. Large sales volume made possible by a large customer base and scale of operation. They have divided the stores into categories based on the size and prices - Super-centers, Discount Stores, Neighborhood Markets A highly efficient supply chain system that maximizes productivity and reduces outlays. They have their own logistics which includes Tractors, Trailers and own drivers. This allows them to reduce costs of Transportation, on-time delivery of products. Low operational and overhead costs - When compared with Costco, the employees salaries are less in Walmart. Their overhead costs are also less as they have their own Logistics facility and mostly they are doing business online also. International Presence is an added advantage to Walmart .

What do we have in common or not? --------------------------------------------------------------------------------

We are all familiar with both of these companies. I found that the easiest way to compare how each of them delivers value to its customers was to show them side by side in the table below. Both of these companies provide a unique and interesting service to their customers and they are very effective in the business of retailing.

Please note, I have hyper-linked the specific words to where I found the information in the table below. For example, "customers" on the Costco side are linked and when you click on the link it will take you to the article.

Walmart	Costco
Targets lower-income customers	Targets higher-income customers (Links to an external site.)
Spends about 2.4 Billion dollars of its revenue on advertising (Links to an external site.)	Spends little to no money on advertising (Links to an external site.)
Walmart is not typically known for its customer service	Invests in their employees and their pay (Links to an external site.) creating a better experience for customers
Walmart stores are everywhere and customers can shop at any location with no added benefit or no motivation to choose a different Walmart location.	Sells (Links to an external site.) memberships that include additional discounts, a wide selection of merchandise, and exclusive member services.
Walmart sales were 510.33 Billion (Links to an external site.)	Memberships account for about two-thirds of overall sales (149 Billion) (Links to an external site.)
Sam's Club has 599 Total Units (Links to an external site.)	Costco has 785 Total Units (Links to an external site.)
Walmart has other stores that they have to stock and maintain costing them more money (Neighborhood Walmart, Walmart Supermarket, Sam's Club, etc.)	Costco has just the Costco store
The perception of Walmart is that they have anything you need in one store	The perception of Costco is that it is a bulk store to buy high-quality bulk items
Walmart Supercenter carries approximately 140,000 products (Links to an external site.)	Costco warehouse carries only 3,700 distinct products