Costco's Long-Term Success Depends on This One Thing
Investing in retail stocks can be a challenging endeavor. Margins are thin, competition is fierce, and any competitive advantage is difficult to maintain. Companies in this industry need some sort of differentiation in order to succeed for an extended period of time. This differentiation often manifests in delivering exceptional customer service.
Few retailers can sell truly unique products compared to competitors, but many can compete and win by focusing intensely on the customer experience. Costco (NASDAQ: COST), with its extremely loyal fan base, immediately comes to mind.
Costco has fared well during the coronavirus pandemic. The stock is up 2% year to date, albeit with high volatility in March. Despite having negative comparable sales in April, the company finished its fiscal 2020 third quarter with comparable-sales growth of 4.8% year over year. After customers stocked up on essential goods to comply with shelter-in-place orders, sales softened in April before picking back up in May.
Source Fool.com
