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Costco and Pro Employee Benefits

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Read the attached article on Costco prior to answering these discussion questions.

1. What competitive pressures does Costco face and how does their "pro-employee attitude" help them overcome these pressures?

2. What are some of the hidden costs associated with the cheap-labor model popularized by Costco's chief competitor, Wal-Mart?

3. Some shareholders have balked at investing in Costco, would you invest in companies with management philosophies like that of Costco's, why or why not?

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Solution Summary

This solution is based on an attached article about Costco in relation to the competitive pressures that Costco faces, and evaluates how their pro-employee attitude helps them overcome these pressures. It also discusses hidden costs associated with the cheap labor model popularized by Wal-Mart. It discusses if it is recommended to invest in companies with management philosophies like Costco.

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1. What competitive pressures does Costco face and how does their "pro-employee attitude" help them overcome these pressures? 


Costco faces the competitive pressure to compete in the marketplace with products, price, selection, and service while balancing overhead, including employee expenses. In addition, Costco faces the pressure of making its' shareholders happy. This is a balancing act in which they have chosen to take care of their employees. As a result, Costco can boast having "one of ...

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Sally Baldwin, Ed.D
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  • BA, University of Southern California
  • MSS, United States Sports Academy
  • Ed.D, Boise State University
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