Costco Operations Study

Team SC^2 Sunny Jain Vikram Kaledhonkar Eva Lo Eileen pertinacious Olena Marchenko speak toco Wholesale Operations and Supply Management OMIS 357 (Fall09) Agenda ? ? ? ? ? ? ? Background and concern Model Processes and Queues Management Supply Chain St setgy reference Control fund Management Recommendations Q&A Background ? ? ? ? Headquartered in Issaquah, WA 550 warehouses in 40 states Present in 6 countries outside US $71B revenue in 2008 1993: merged with PriceClub: PriceCostco (206 locations) 1998: Costco.com 1999: Costco wholesale 2009: 417 worldwide. 7th largest retail merchant in world, fortune 500 1975 1980 1985 1990 1995 2000 2005 2010 1976: 1st PriceClub warehouse 1983: 1st Costco warehouse 1996: PriceCostco to Costco companies Inc.

2003: 24 untested warehouses Corporate strategy Business Model ? Three fold model ? Sales of Goods ? 5 major categories ? Memberships ? Goldstar, Business and executive ? 87% renewal rate in Goldstar ? 98% renewal rate in executive ? accessory services ? Gas, pharmacy, photo, hearing aid, food, optical Processes ? Overall product extend diagram ? Make-to-Stock ? Cost advantage: warehouse = buffer + retail Costco Warehouse Buffer client places order Supplier Vendor Goods Costco Depot Deliver Distribute Costco Warehouse Customer places order Buffer Deliver Processes ? Product flow within warehouse Costco Depot Goods Warehouse Customer Arrival by Truck Stock/Shelve Sell Inventory Measurement Feedback Queues ? Customer order flow and queue control ? Multichannel, private phase & single channel, single phase; Members/hour statistics Queue fancy Store Shop around Queue Queue Queue Customer Service Checkout Photo / pickup Queue Exit Supply Chain System  serve Capacity Management ? ? ? ? 75000 full time employees 62000 contract based employees Seasonal... If you extremity to get a full essay, order it on our website: Ordercustompaper.com

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