Costco is the largest membership-only warehouse club in the U.S. It has a passionate follower base, and now has over 200 international locations. They began their international expansion in 2013.
Many people doubted that Costco would succeed internationally because many other companies have failed such as Tesco, Target, and Walmart. However, Costco has continued to prove people wrong. Costcos membership signups internationally in the first two to three months are about 10 times greater than when a Costco opens in the U.S. They have also been able to retain their members at a rate of 80%. Costco is able to take their high profits from the U.S. and use them to focus on a long-term and sustainable strategy internationally.
So why exactly is Costco able to succeed internationally when many other companies fail? Well, there are a few reasons for this. The first reason is that they focus on making products less expensive for customers. They also have a limited amount of products which makes it a more specialized store. People also like Costco because they treat their employees well. They pay employees two to three times higher than their competitors as well as offer health insurance to their employees. All these strategies allow Costco to be dominant in their market. Costco's worldwide success proves that their formula is a proven success strategy.
I am a big fan of Costco and love going to get bulk food supplies that can last me for a month. They offer great prices on food that you cannot get anywhere else. I believe Costco will continue to dominate their industry worldwide.
Works Cited: https://www.thebalancesmb.com/costco-international-expansion-and-retail-innovation-2891768