An excellent fundamental analysis of the Costco business. It details the Costco business model and flywheel - how low prices leads to more memberships, more sales and leverage with suppliers - thereby leading to even lower prices. It also talks about their operating approach - from how they select what inventory to sell to how they treat employees - and how it’s all designed to serve the customer.

For 40 years, Costco has succeeded with a simple formula: reinvest merchandising profits into lower prices and better products; be a disciplined operator; and treat customers and employees well. But with greater share of shopping moving online, it’s fair to wonder if the company’s best days are behind it. The deck below will explore this in detail.

Read it here.