In both Castcos and Sam’s clubs income will be based solely on how good you do at your franchise location. Each franchisor will require you to pay a franchise fee, a percentage of gross sales, off the top so to speak to them for the privilege of using their name and products. You will be required to purchase their supplies at their prices, even though you can get paper cups cheaper at Sam’s Club or Costco. Franchise fees are usually non-negotiable and range from 5 to as high as 18%. So, consider that you will give $1.80 to the franchisor to sell a person a $10 meal.
Explain summaries of both Stores:
Summary of costco club
It was established in the 1980′s to help people save money. Costco buys its merchandise in bulk so it affiliates lower prices for members. Costco is confident that members will be pleased when they join. The warehouses offer a wide array of top-quality products available from around the world. The merchandise and service presentation is the value that Costco provides to its members.
Summary of Sam’s club
It was started in 1983 and there operating philosophy has remained the same – working hard to be the buying agent for our Members and deliver upon this agreement by eliminating unnecessary costs and maintaining a simple shopping environment. Passing the savings on to the more than 47 million Members who shop in the Clubs.
Compare similarities: Strategic plan
Both have short term and long term strategic.
Employment Objectives:-Both hire great people and treat them well giving them good job
Management Objectives:-Both always promote and training happens constant growth of the club Growth Objectives:- both run the business for long-term sustainability. Opening new stores50-60 new locations per year and keeping Internet sales growing
The club offers low memberships fee starting at $40.the fee include in-store perks like health screenings; tire repair, car battery testing, and wiper blade installation; cheap prescriptions, contact lenses and eyeglasses; delivery and installation for big ticket items; and 24/7 technical support on electronics. The wholesale giant’s large selection of discount items includes many bearing its Member’s Mark label. Sam’s barely edges out its chief rival as our top pick.
The Memberships fee at Costco is $55 and it provide access to a wealthy departments featuring low-priced groceries, home goods, electronics, furniture, pharmacy, photo printing, and more, and at some stores, even cheap wedding dresses. Members also get additional coupons for extra savings, as well as deals on home and auto insurance, car buying, car rental, travel, and numerous financial services.
The cost of 38 items in Sam’s club including bulky good like paper plates, toilet paper, baby formula, dairy products, frozen meats, cereal, snacks and juice. The total cost is $215.65, which is $11.65 cheaper than Costco club. Also part at Costco club shopping of the same 38 items, including snack foods, dairy products, baby products, meats, fresh produce, and paper goods, came to $227.08. The bottom line for the same basket of goods at Sam’s Club was $11.43 lower, but on a unit-price basis, Costco was 3.6% cheaper than Sam’s.
Future plan: Future expansion
Both stores have a plan of expansion 27- 30 new store in 612 locations worldwide.
Private label growth. As more stores open, more opportunities are created for Kirkland to compete against big brands. You can also plan on seeing more margin enhancing Kirkland Signature products in the future.
Mission and Vision
The clubs have the mission of getting the business to the whole world and their vision is to open as many store as possible.
How both stores keep customer’s coming back?
They stores are kept clean always and prices are customer friendly .they keep their prices as low as possible.