Why Costco's Primed to Push Forward Against Inflation

For decades, Costco Wholesale (NASDAQ: COST) has used its unique warehouse business model to garner steady, consistent success. Now, despite the current inflationary climate, this trendy big-box retailer has an arsenal of effective weapons to maintain its momentum.

Costco built its business on buying in bulk, using its massive size and purchasing power to get cheaper prices from suppliers and passing the savings on to customers. To save money, it limits the number of items it carries. That approach turns shopping at Costco into a serendipitous scavenger hunt, with buy-now-before-it's-gone quantities of luxury offerings to lure in high-income customers and encourage them to spend generously.

Meanwhile, fewer, simpler choices leave customers less stressed when deciding what to buy. Those reduced options include its high-quality, low-cost Kirkland Signature private-label brand, which accounts for more than 30% of Costco's sales.

Source Fool.com