Costco operates as a warehouse retailer. The company offers its products at prices considerably lower than those of many of its competitors. It does this by keeping its product markups low, at around 15%. In sharp contrast, many department stores and supermarkets mark up their merchandise by 25% or more. The big box retailer displays its goods in simple boxes and on shelves to keep its costs low.
Costco is commonly referred to as the ultimate "anti-Walmart" due to its unique limited brands strategy that involves offering just a few brands for each product it stocks. For instance, you might find just four toothpaste brands in a Costco store, but several dozen brands in a typical Wal-Mart store. The company keeps it its product line ever-fresh by regularly changing its brands. Customers can always expect to find something new and unique at its stores. This makes shopping at Costco feel like an exciting treasure hunt.