Costco and Cars
With the
holidays quickly approaching, it’s becoming an important time of year for the
auto industry. Because of a recent deal with General Motors, one unlikely
retailer’s power in the industry will be on the rise. Costco has recently
partnered with General Motors for their Holiday Sales Event, which runs from
October 1st through January 3rd.
The partners have come together again in hopes
of exceeding last year’s 34% increase in sales during the promotion. Costco
doesn’t make any money on the sale of the cars, but it does receive the benefit
of gaining and retaining memberships through its car sale offerings. The major
draw towards Costco over other auto retailers are the fixed prices; Unlike auto
retailers, Costco sets fixed prices and doesn’t participate in bargaining or
upselling. This tactic convinced over half of the consumers who participated in
the event to switch to the General Motors brand. In a survey sent to
participants of the promotion, over 96% of those who responded reported a high
satisfaction with their experience. As the next holiday season approaches, both
companies look forward to seeing an increasing success in automobiles in the
wholesale market.
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