Costco
Acquired
Costco's Strict Margin Cap and Competitor Margins
Costco aims to provide exceptional value to consumers by enforcing a strict margin cap of 14% on products, ensuring members get better deals than anywhere else. They negotiate hard but fairly with suppliers to secure unbeatable prices. The only exception is Kirkland signature, which allows a 15% markup. In comparison, department stores commonly have a 100% markup, while even discount retailers like Walmart mark up by 25%, almost twice as much as Costco.
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