Module 7 grocery stores costco
Download
1 / 10

Module 7 Grocery Stores Costco - PowerPoint PPT Presentation


  • 198 Views
  • Uploaded on

Module 7 Grocery Stores Costco. Megan Wiethoff. Costco Overview. Founded in 1983, in Seattle, WA Originated the membership concept for wholesale club retailers Offers members low prices on a limited selection of high-quality, popular brands Warehouses are designed to be cost efficient

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about ' Module 7 Grocery Stores Costco' - dolph


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
Module 7 grocery stores costco

Module 7Grocery StoresCostco

Megan Wiethoff


Costco overview
Costco Overview

  • Founded in 1983, in Seattle, WA

  • Originated the membership concept for wholesale club retailers

  • Offers members low prices on a limited selection of high-quality, popular brands

  • Warehouses are designed to be cost efficient

  • Has been increasing its fresh food selection, up to 13% of total sales


Industry performance
Industry Performance

  • Fluctuations in disposable income has caused consumers to reduce the quality and quantity of goods they purchase

  • Growth in the past 5 years is mainly due to spending on consumables and expansion initiatives

  • The industry is highly saturated and has low profit margins

  • Warehouse clubs and Supercenters have increased their grocery offerings, which increases competition in the industry

  • High food prices have also limited profitability


Forecasting
Forecasting

  • Assumptions

  • Sales growth rate 6%

  • Enterprise profit margin (EPM) 2%

  • Enterprise asset turnover (EATO) 9



Discounted cash flow
Discounted Cash Flow

  • Sales Growth: 6% Cost of Capital: 7.53%


Residual income model
Residual Income Model

Sales Growth: 6% Cost of Capital: 7.53%


Discounted cash flow changing growth rate
Discounted Cash Flow: Changing Growth Rate

Sales Growth: 6% Future Growth: 3% Cost of Capital: 7.53%


Residual income model changing growth rate
Residual Income Model: Changing Growth Rate

  • Sales Growth: 6% Future Growth: 3% Cost of Capital: 7.53%



ad