Big Box Store Competition
Three main rivals typify the wholesale club sector of the retailing business in North America. They encompass BJ’s Wholesale Club, Sam’s Club, which is a subsidiary of Walmart, and Costco. The wholesale clubs deal in a broad scope of products that include foodstuff, electronics, tires, stationery, and office supplies. The rivals employ cost reduction strategies to draw as many clients as possible.
They attract many customers from diverse fields, for example, churches and businesspersons. Costco Wholesale Club dominates in the North American market. It enjoys more than 56% of the total market share while Sam’s Club follows with about 36%, and BJ’s Wholesale Club closes with around 8% in the industry (Thompson, 2010). Other businesses that operate in the market are Office Depot and Staples, Dollar General, Target, and Kohl’s. Apart from pricing strategies, competition in the market appears to be founded on services and product quality, in addition to location. Strategies such as improvement of merchandise, marketing, and service quality are advocated for competing against Wal-Mart, the largest retailer across the globe, as well as all big box stores.
Although Costco Wholesale Club is the dominant company in the North American market, it should employ the strength of novel technologies to better its business strategies and outshine big box stores that are leading in other markets. It should also embrace strategies such as enhanced advertisement in social media platforms to attain a competitive benefit in the industry around the world. Moreover, the company should employ the influence of corporate social responsibility, which will act as a way of enticing potential customers and remaining true to its commitment to caring for the welfare of its customers.
Thompson, A. (2010). Case 4: Competition among the North American warehouse clubs: Costco Wholesale versus Sam’s Club versus BJ’s Wholesale. Web.