Costco Wholesale Corporation’s mission statement and vision statement establish the company’s position as one of the largest retailers in the world. The goals and strategic objectives of the warehouse club business are based on its mission and vision. The firm’s mission statement guides the overall direction of organizational development. On the other hand, the corporate vision statement emphasizes savings for customers in this retail business case. The vision statement determines Costco’s generic competitive strategies and intensive growth strategies for achieving the mission. These business strategies and related tactics support brand value and customer loyalty, which affect the retail company’s performance and long-term competitiveness. Together with the corporate vision statement, Costco’s corporate mission statement highlights the importance of creating value for customers, such as through pricing.
Costco’s corporate mission and corporate vision influence strategic decisions throughout the organization. For example, the types of the company’s goods and services are representations of the goals that the mission and vision call for. Also, the marketing mix (4P) of Costco Wholesale Corporation determines its pricing strategy based on the emphasis on savings and low prices in the mission statement and vision statement.
Costco’s Mission Statement
Costco’s mission statement is “to continually provide our members with quality goods and services at the lowest possible prices.” This mission gives an overview of the company’s business purpose, the nature of its business, and what its stores can offer to shoppers. The following main points are in Costco’s corporate mission:
- Membership
- Quality goods and services
- Lowest possible prices
Costco’s mission statement includes the “membership” point to describe the nature of the business – a warehouse club or membership-only retailer. This “membership” characteristic is what the business is known for and establishes a condition of exclusivity for customers’ access to the company’s merchandise. Quality is another point in the corporate mission statement, indicating that quality is a goal, a selling point, and a contributor to Costco’s competitive advantage. Also, the corporate mission states that low prices are another selling point that draws customers to the company’s stores. The points on price and quality make the company directly compete with many other retailers. For example, Walmart, Target, and Amazon compete based on price, and Whole Foods competes based on quality, while Home Depot competes based on price and service quality. To address this quality requirement of the mission statement, quality is integrated as a factor in organizational development, such as through the organizational culture of Costco Wholesale and its promotion of quality in retail service. As a result, employee performance relating to quality standards reflects Costco’s mission statement.
Costco’s Vision Statement
Costco’s vision statement is “to be a place where efficient buying and operating practices give members access to unmatched savings.” Business efficiency, accessibility of products, and savings are the emphases in this retail business vision. The following are the main points of Costco’s corporate vision:
- Place of efficient operations
- Access through membership
- Unmatched savings
Costco’s vision statement defines the goal of efficiency in operations. Such efficiency minimizes costs and prices. Costco’s organizational structure or corporate structure provides the framework for facilitating efficiency in operations. The structural components of the retail business have processes, including e-commerce processes, that focus on cost reduction. Operations management at Costco also ensures that all areas of the business are designed, managed, and maintained with cost minimization in mind. Low costs help strengthen the financial status of the warehouse club business. Also, cost minimization leads to another point of Costco’s vision statement: unmatched savings. Customers can expect savings through low prices based on membership status. Access through membership is the component of the vision statement that indicates Costco Wholesale’s membership-only warehouse club business model.
Key Points of Costco’s Corporate Mission and Corporate Vision
Costco’s mission statement and vision statement both specify a membership-based business model. Also, low costs and low prices are pointed out in the corporate mission and corporate vision of the retail business. A key difference is the specification on access and efficiency. Costco’s mission statement requires quality goods and services. This means that the company uses quality as a differentiator in the retail industry. In contrast, Costco’s vision statement requires efficiency. Efficiency contributes to the quality of the company’s organizational output. In this way, the mission and vision are aligned in supporting high quality and cost-effective retail business operations. This situation involves membership-based customer loyalty, operational efficiency, and quality goods and services, which are all factors that boost the business strengths shown in the SWOT analysis of Costco Wholesale Corporation. These factors help the company maintain its competitiveness in the international retail market.
References
- Costco Wholesale Corporation – Form 10-K.
- Costco Wholesale Corporation – Sustainability Commitment.
- Costco Wholesale Corporation Announces an Increase in Its Quarterly Cash Dividend.
- Fitzsimmons, A. B., Qin, Y. S., & Heffron, E. R. (2022). Purpose vs mission vs vision: Persuasive appeals and components in corporate statements. Journal of Communication Management, 26(2), 207-219.
- Reid, S. E., & Crawford, C. B. (2022). Crafting the Vision Statement. In Entrepreneurial Vision: A Guide for Charting and Implementing the Visioning Process (pp. 263-276). Cham: Springer International Publishing.
- Toh, S. Y., Tehseen, S., Mahmoud, A. B., Cheok, J., Grigoriou, N., & Opute, J. (2022). Mission statement effectiveness: Investigating managers’ sensemaking role. Corporate Communications: An International Journal, 27(2), 329-345.
- U.S. Department of Commerce – International Trade Administration – Retail Trade Industry.