E-Business Applications for Costco: Advantages, Challenges, and Recommendations

E-Business Applications 1
E-Business Applications
by [Name]
Course
Professor’s Name
Institution
Location of Institution
Date

E-Business Applications 2
Contents
Introduction.................................................................................................................................................2
Body............................................................................................................................................................2
Recommendations and conclusion..............................................................................................................7
References.................................................................................................................................................10

E-Business Applications 3
E-Business Applications
Introduction
Costco is one of the leading multinational companies, dealing with fast moving products.
According to Paromita & Joel (2016, p. 24), this company competes with different businesses in
the retail industry, including Walmart, and uses different operational strategies to ensure it
attains a competitive advantage. The company deals with a variety of products, including
rotisserie chicken prime beef, wine, organic foods among others
Body
According to Jing (2014, p. 77), the digital revolution has seen many businesses realizing
different transformations in their operations, some of them being of benefits while others
seeming to hurt various organizations. For Costco, digital revolutions have seen the company
realize various changes, such as being able to link with consumers in different geographical
locations.
However, just like marc Andreessen the founder of Netscape claims in the article “ the
future of the retail store-what does online mean for bricks and motor?” going online has made
businesses to lose some of the most essential things in their operations. For example, it has
limited the social interactions of customers who before the introduction of the online platform
used to interact in the stores while waiting to be served. According to Hyma (2015, p. 24),
customer interactions are crucial in businesses because it enables organizations to realize large
customer turnout because when they meet a particular place and know each other, the chances of
revisiting that place are always high.

E-Business Applications 4
Although Netscape has various critics on going online, the strategy has enabled Costco to
realize various advantages. For instance, it has enabled the company to serve more customers
every day as compared to the past. This has been attained through having a platform that helps in
connecting the management with customers who are at different geographical locations. Initially,
before the introduction of the online operations, the company used to have long queues, which
made some of the customers to fail in getting proper services.
In the recent days, this company has realized a significant reduction in operation cost due
to the introduction of e-business in its operations. This has been attained through paying fewer
salaries as compared to the past where the company required to hire many people to serve the
huge number of customers who visited the stores from time to time. As at now, the company
requires less number of staff members because most of the activities are undertaken online. Nir
(2010, p. 89) asserts that technology plays a key role in making an organization to reduce its
operations costs and this has been realized by Costco because most of the operations are done
online, meaning the company does not require a lot of workforces.
Based on the video, technology has made people to be busy than ever through access to
information through their cellphones and therefore retail stores should take this as an advantage.
Although Costco has made various steps to make its operations digitized, there are a lot of things
that the company need to do to ensure it takes the advantage of digital revolutions. While other
retail companies appear to have shifted to online operations, this company seems not to have
done much and therefore if it does not optimize its operations using the available digital
platforms to minimize the physical purchase, there is a possibility that with time it may lose its
market share.