Charity Luetke
BS100.RO2
12.11.2012 The business world is competitive and complex. Why would someone pay an annual fee in order to shop at a store with bare walls and goods lying on pallets? Costco just recently opened a new store in Rochester and has proven that their company mission and vision has a sustainable future and strong marketability, even in a poor economy. Headquartered in Issaquah, Washington, Costco has operations in the US, Puerto Rico, Canada, the UK, Taiwan, Korea, Japan, Mexico and Australia and employs 164,000 people. They are a truly global company. Most of their outlets are in large cities or located in the surrounding suburbs with 592 warehouses in operation worldwide at the end of 2011. With a few exceptions, they market themselves much the same as other wholesale retailers using the "more is better" ideology we Americans love. One thing that Costco will never do is advertise, generally limiting their advertising to new warehouse openings and occasional direct marketing programs to existing members. Almost all their promotion is done by word of mouth, another way Costco saves on expenses. One thing I heard several times from employees while inside the Rochester Costco, is that they will never mark the aisles. Because they do not always carry the same products, the consumer is encouraged to pick up an item when they find it. The phrase employed is that every visit to Costco is "like a treasure hunt". Customers are encouraged to roam the aisles to find that treasure. Product placement on the aisle end caps, non-marked aisles and a distinct lack of any music, creates an atmosphere inside every building that the customer has stepped outside of time and encourages them to stroll around and see what they can find, and as a result, it is not uncommon to end up spending more than intended. Management has recently changed hands . In January of 2012, owner and co- founder of Costco, James Sinegal, stepped down as the chief executive. The chief operations officer, Craig Jelinek, was appointed as the new CEO and continues to work in that position. Craig Jelinek joined the company in 1984, opening the sixth company warehouse. He quickly rose through the company ranks, and was promoted to assistant vice president/regional manager in 1985 and then senior vice president of operations for the West Coast in 1992. After Costco merged with Price Club in 1995, Craig was given responsibility for the NW region and the Northern division. In 2004 he was promoted to executive vice president and chief operating officer responsible for overseeing merchandising, E-commerce, and purchasing. In 2012 he was appointed to replace James Sinegal as chief executive officer. Richard Galanti is the vice president of Costco wholesale and the new chief financial officer. He also joined the company in 1984 as the vice president of finance. He served as the Costco senior vice president, chief financial officer and Treasurer from 1985 to 1993 and has been the executive vice president and chief financial officer since 1993. Mr. Galanti became a Director for the company in 1995. The Board of Directors consists of Craig Jelinek, Richard Galanti, Jeffrey Brotman, who is the chairman of the board. Mr. Brotman co-founded the company with James Sinegal and has served in this position since the company inception. John McKay is the executive vice president and chief operating officer of the Northern division and Midwest region since 2010 and serves as senior management on the board of directors. Formerly he was the senior vice president and general manager of the Northwest region from 2000 to 2010. Douglas W. Schutt is the executive vice president and chief operating officer, merchandising since 2010. Previously he was responsible for the Northern and Midwest division from 2004 to 2010. James Murphy is the executive vice president, International division since 2011. He served as the senior vice president of International division from