Walmart is a huge store that offers a wide range of products including clothing, household goods, furniture, and groceries. They are mainly based in North America. Their main business idea is to make products affordable so that consumers can save more on things they need day in and day out. Costco is a membership-based wholesale supermarket that also offers a wide range of products from foods to hardware and electronics. Costco is also based mainly in North America but has also spread across many other countries in the world. Let us look at ‘Walmart vs Costco’.
Walmart vs Costco
When you compare the two stores they are generally alike in the way they do business and their general business mission which is to make sure that their customers are making more savings. They achieve this by offering discounted prices on products that are bought regularly and used every day.
Business models
A business model is basically a plan that a business has to achieve what it set out to do and make a lasting mark in the market.
Just as their tagline says, Wal-Mart’s business model is largely focused on assisting the customers to make more savings and they do this by trying hard to push down their prices and offer discounts as much as they can.
Costco also offers discounted prices but not so much as they are already a wholesale store. They however focus and earn more from their membership fees. They have this advantage because you cannot shop at Costco without being a member. This business strategy has largely ensured that Costco customers remain loyal to the store because there are benefits to using your membership card more often.
Pricing
If you are looking for the best store to do your shopping from, it is absolutely important to look at the pricing of the stores in your options. Although Walmart and Costco both offer discounted prices for their products, you can only really know the cheaper one among them by looking at the differences in unit price.
Walmart is well known for roll-back pricing and offering price matches on their different products but some of them may be more expensive than at Costco. This is because Costco offers large quantities for reasonable prices of mostly the same product you will find at Walmart.
For this reason, you shall determine the cheaper option based on the quantities you need and the unit price at each store to make your decision.
Revenue
During and after the global pandemic, Walmart has seen increased revenue mainly accredited to their big efforts in investing in e-commerce platforms to increase their sales volumes. This period has in turn resulted in the largest revenue increase for Walmart in the last 5 years combined. Wal-Mart’s ability to participate online and improve their services for their customers has earned them a greater reward in terms of money made.
Costco on the other hand did not make a very big deal of the online space during and after the pandemic. However, their target market is usually people with more disposable income so they really did not have to make a large investment in their technology improvement.
During the pandemic, Costco saw an increase in membership because most customers would prefer to buy products in bulk as the global situation was very unpredictable at the time. This resulted in increased revenue for the business through membership fees.
Employer comparison
When comparing Walmart and Costco as employers, it is important to look at their employee ratings, offered salaries, general reviews made by customers regarding their services, pros and cons of being an employee in both stores, and the availability of job openings.
1. Employee ratings
Generally, Costco scores higher in this area. Full-time and part-time employees at Costco rate working at the store with 4 stars. This is mainly because the business gives its employees a suitable working environment where they can effectively carry out their duties. They are also supported by management and the majority rate their CEO and general management as over 90% helpful.
2. Salaries
| Walmart | Costco | |
| Cashier | $12/hr | $17/hr |
| Sales associate | $13/hr | $16/hr |
| Manager/supervisor | $16/hr | $29/hr |
When you compare the salaries for similar jobs in both stores, Walmart offers the most stable and also higher salaries overall.
3. Job postings
Walmart has more recent and updated job postings largely due to its excellent online presence. While Costco also has opportunities they have not made a conscious decision to invest in e-commerce as compared to Walmart.
Conclusion
Your specific needs will determine which store you choose.
Frequently asked questions
- Is it cheaper to shop at Costco or Walmart?
It all depends on what you need. For individual retail options, Walmart is the best but for wholesale bulk items, Costco has better offers.
- Is Costco a wholesale or retail store?
It is a membership-based wholesale store.
