Then, those other companies take that strategy and see how they can improve upon it and make it even better (Barrett, 2003; Drucker, 2004). If the first company does not keep up with the changes that competitors are making, that company could find that it is getting pushed from the market (Gomez-Mejia, Balkin, & Cardy, 2008; Kleiman, 2010)
, 2011). Errors in judgment (often based on misinformation or incomplete information) can happen to anyone (Kleiman, 2010)
Costco is a warehouse-style retailer, just like the other two companies. Typically, these companies offer lower prices, but consumers who shop there also need to buy their items in bulk (Thompson, et al
Looking at Costco, power shifting is illustrated with distribution of decision-making power between the firm and its business partners in Japan (home headquarter, subsidiaries and suppliers). Based on the concept of embeddedness, it is clear that Costco's localization strategy takes account of all process factors such as consumer preferences, market's culture, dominant organizational management forms, and supplier systems in Japan (Kurtz & Boone, 2010)
The product range is the level of difference between the merchandise that Costco selects to in order to adapt consumer preferences in Japan. Costco's success in Japan was premised on the good localization strategy (Matthews, 2011)
Glocalization is also a new concept communicating an idea related to localization. Costco uses glocalization by integrating its global business to adapt to the local strategies in Japan (Rugman, 2010)
As a successful leading retailer, Costco depends on a cost-effective relationship with its suppliers. Although excessive local suppliers and intermediaries might affect the value-added activity and shift power between suppliers and retailers, forming tight working ties with local suppliers is integral in maintaining power over operations, price, inventory, information and channel structure (Sternquist & Witter, 2011)
WalMart's won internal competitive analysis has shown the mass merchandisers sees Costco as a threat for the aspiring buying segments that the global retailer is just beginning to attract with higher-end electronics products (WalMart Investor Relations, 2013). WalMart's low price everyday value proposition is one that attracts the Price Value Shopper and makes them exceptionally loyal as this segment looks to WalMart to help them makes ends meet on a periodic basis (Cascio, 2006)
While Wal-Mart's core shopping base is the Price Value Shopper that has an average income of approximately $45K and is the most loyal segment of their customer base (WalMart Investor Relations, 2013) the other 84% of shoppers at Costco's largest competitor are higher income and more eclectic, even selective, in their retail store loyalties. Costco has been able to capitalize on this higher-end segment by streamlining their supply chain while also concentrating on a broader mix of higher-end products as well (Serpkenci, Tigert, 2006)
One of the essential forces of competition affecting the organization towards the achievement of its goals and objectives is the rivalry among existing players in the industry and market of operation. It is essential to recognize the tendency by the major players like the case of Costco to provide products and services at lower prices (Kozloff et al
It competes with the wholesale entity, Sam's Club owned by Wal-Mart in the U.S. (Kim & Mauborgne, 2010)
This happens rather from government policies looking to draw in FDI by means of improved human capital. When people are employed by MNE subsidiaries, their human capital may be improved further through training and on-the-job learning (Krugman & Wells, 2013)
Education in itself is unrealistic to make a nation attract foreign investors. Where a noteworthy "information gap" is permitted to endure between foreign entry and the host country, no large overflows will be expected (Madaan, 2009)
The company is essentially engaged with the operation of membership warehouses in Canada, United States, Mexico, Puerto Rico, Canada, the United Kingdom, Japan, Australia, and via majority owned subsidiaries in Korea and Taiwan. The company's normal stock is trading on the NASDAQ Global Select Market under the image COST (Marchetti & Roy, 2009)
Anecdotal proof of customers who come back from such shops shows that the wholesale industry attracts satisfactory sales. Indian customers are usually observant about this (Mukherjee & Patel, 2010)
Our members are our focus of success because of their influence in making the difference in our revenues, satisfaction, and competitive nature within the market and industry of operation. Our members have substantive outlets and alternatives that might affect us whenever they decide to switch shops (Thomas et al
In order to realize our mission, we will execute our business with the following Code of Ethics in mind: Code of Ethics Our code of ethics will focus on five critical elements: Taking care of our members Obeying the law Taking care of our employees Respecting our suppliers Rewarding our shareholders The achievement of the first four elements will facilitate the ability of Costco to realize its ultimate goal in relation to Rewarding Shareholders. Obeying the Law The law is the ultimate facilitator in the execution of the business operations (Wadhwa, 2009)
Any comment or recommendation will be in the code of ethics thus submission to the executive council as an agenda. Finally, the executive council of Costco should approve the revised code of ethics in case of no issue or comment emanating from the committee or the members (Rafter, 2005)
As the highest organ in the organization, the executive management council should focus on delegation of duties in relation to the statement of code of ethics to the Committee on Ethics and Professional Conduct. The committee should ensure that the code of ethics is available to all employees and other relevant stakeholders through displaying the statement on the organizations' walls as well as website for easier accessibility (Weber, 2013)
The code of ethics is a crucial document thus the need to anticipate how stakeholders, competitors, and other interested parties will receive or react to it for the realization of the goals and objectives. Stakeholders such as employees, suppliers, and consumers should embrace the code of ethics because of its ability to address and protect their interests as they seek to satisfy their needs and preferences (Yallop, 2012)