Costco Wholesale Corporation operates membership warehouses in the U.S., Puerto Rico, Canada, Mexico, Japan, the United Kingdom, Korea, Taiwan, Australia, China, Spain, France, Iceland, New Zealand, and Sweden. The company also operates e-commerce sites in various countries. Costco's business model is based on offering members low prices on a limited selection of nationally-branded and private-label products, resulting in high sales volumes and rapid inventory turnover. This, combined with operational efficiencies from volume purchasing and a no-frills warehouse environment, enables Costco to operate profitably at significantly lower gross margins than most other retailers. The company emphasizes direct relationships with suppliers, efficient distribution through cross-docking consolidation points, and a membership format that enhances customer loyalty and controls inventory losses. Costco also offers ancillary services such as gasoline, pharmacy, optical, food court, and tire installation, further driving member traffic and sales.

• Employees: 333,000 (as of September 1, 2024)
• Geographic Footprint: 16 countries/regions
• Headquarters: Issaquah, Washington
• Founded: 1983
• Number of locations/facilities: 890 warehouses (as of September 1, 2024)
• Revenue: $249.63 billion (FY2024)
• Key Subsidiaries/Brands: Kirkland Signature

• CEO: Ron M. Vachris
• CFO: Gary Millerchip
• Board Chair: Hamilton E. James
• Other Key Executives: Richard A. Galanti (Executive Vice President), Russ D. Miller (Senior Executive Vice President, U.S. Operations), Claudine E. Adamo (Executive Vice President, Merchandising), Patrick J. Callans (Executive Vice President, Administration), Caton Frates (Executive Vice President, Chief Operating Officer, Southwest Division), Teresa Jones (Executive Vice President, Global Depots and Traffic), Jim C. Klauer (Executive Vice President, Chief Operating Officer, Northern Division), Javier Polit (Executive Vice President, Chief Information and Digital Officer), Pierre Riel (Executive Vice President, Chief Operating Officer, International Division), Yoram B. Rubanenko (Executive Vice President, Chief Operating Officer, Eastern Division), John Sullivan (Executive Vice President, General Counsel & Corporate Secretary)

• Annual Revenue: $249.63 billion (FY2024)
• Net Income: $7.37 billion (FY2024)
• Total Assets: $69.83 billion (as of September 1, 2024)
• Number of employees: 333,000 (as of September 1, 2024)
• Key Financial Highlights: Net sales increased 5% year-over-year, membership fee revenue increased 5%, gross margin percentage increased 35 basis points, and net income increased 17%.

Costco offers a wide range of products and services across several categories:

• Foods and Sundries: Includes packaged foods, beverages, snacks, cleaning supplies, and other household essentials.
• Non-Foods: Encompasses appliances, electronics, health and beauty products, hardware, apparel, and more.
• Fresh Foods: Includes meat, produce, bakery items, and deli products.
• Warehouse Ancillary: Features gasoline, pharmacy, optical services, food court, hearing aids, and tire installation.
• Other Businesses: Includes e-commerce, business centers, and travel services.

Costco's private-label brand, Kirkland Signature, represents a significant portion of its offerings and contributes to higher margins.

Costco operates across three primary business segments: United States, Canada, and Other International. These segments are based on geographic location and reflect management's organizational structure. In FY2024, the United States segment contributed the largest portion of revenue and operating income.

Costco's business strategy centers on providing high-quality merchandise at competitive prices to its members. The company prioritizes high sales volumes and rapid inventory turnover, achieved through bulk purchasing and efficient distribution. Costco aims to maintain its "pricing authority" by consistently offering the best value to members. Growth strategies include expanding the warehouse base in existing and new markets, both domestically and internationally, and enhancing e-commerce capabilities. Costco also invests in its employees, offering competitive wages and benefits to reduce turnover and improve productivity. The company continues to expand its Kirkland Signature private-label brand to differentiate its merchandise and improve margins.

Costco operates in the highly competitive retail industry, competing with global, national, and regional wholesalers and retailers, including supermarkets, supercenters, online retailers, and other warehouse clubs. Key competitors include Walmart, Target, Kroger, Amazon, Sam's Club, and BJ's Wholesale Club. The industry is influenced by factors such as price, merchandise quality and selection, location, convenience, and customer service. The rise of e-commerce and mobile shopping has intensified competition and increased the importance of omnichannel strategies.

• Dependence on U.S. and Canadian Markets: A significant portion of Costco's revenue and operating income comes from these markets, making the company vulnerable to economic downturns or changes in consumer spending in those regions.
• Growth Strategy Challenges: Expanding into new markets and integrating acquisitions can present challenges related to site acquisition, competition, and attracting members.
• Maintaining Membership Loyalty: Costco's profitability relies on membership growth and renewal rates. Damage to the company's brand or reputation could negatively impact membership and sales.
• Supply Chain Disruptions: Costco's business is susceptible to disruptions in its merchandise distribution or processing, which could impact sales and member satisfaction.
• Cybersecurity Threats: The company faces increasing risks related to data breaches and cyberattacks, which could compromise sensitive information and disrupt operations.