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Cash Flow Dynamics: How Price Club and Costco Operate
Price Club and Costco's cash flow model is different from competitors like FedMart/nSuppliers deliver goods directly to warehouses/nGoods are available for sale immediately upon delivery/nPrice Club and Costco sell goods before paying the supplier/nCostco turns inventory 12.4 times per year, faster than competitors like Walmart and Home Depot/nCostco has zero dollars tied up in inventory and can make money on the float/nCostco sometimes turns inventory two or three times before paying the supplier/nVendors effectively finance Costco's inventory