Costco Wholesale
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This learning journey covers:
- Costco’s culture and how Sinegal’s rigorous gross margin philosophy has slightly faded under Jelinek
- How COST's buying role and team is structured vs other retailers
- The buying team’s principles and how buyers work with suppliers to reduce costs
- Why Canada runs at higher operating margins than the US
- How COST have expanded across Asia and outlook for China and Asia store count
- UK and Europe case study and why it’s challenging to grow units
Culture & Gross Margin Philosophy
A key angle of our COST research is to understand how the culture of Costco has changed as leadership evolved from Sinegal to Jelinek. A core tenet of COST’s philosophy has been to strictly limit the gross margin per item to ~14%. This aims to ensure that COST maximizes the “slope of value”, the value per item relative to input costs and competition, and ensures COST is putting its members first.
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