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Difference Between Amazon and Costco

Choosing a store that you can stick to can be overwhelming most of the times. It gets even more challenging if you do not have a favorite one and are used to shopping wherever you are at a given time. Now, it is even extra overwhelming if you have to choose between two competing stores but either has more options, or the other offers more interesting selections.

That would be the case for someone who is torn between shopping with Amazon and Costco. The two are among the largest stores worldwide each with controlled markets respectively. Based on their different operating models, it would play harder for someone who does not have either of them as their choice of shopping, but they are the only options.

If you have been caught up in the confusion, you are not alone. Choosing between going for Amazon Prime and Costco’s membership clubs can be a hard one. However, you can try to dissect the two and make a choice between them. This post will help you compare them by giving you the notable differences.

However, your shopping or the choice of the store is solely dependent on you. The post does not intend to make you change your favorite store. Also, it does not seek to get the reader the best store between the two.


What is Amazon?

Amazon.com, Inc., is an international conglomerate that does business as Amazon. It has a presence in multiple countries worldwide and mainly focuses on cloud computing, e-commerce, computer hardware, as well as artificial intelligence.

Based in Seattle, Washington, Amazon was founded on July 5, 1994, and between 1994 – 1995, it operated as Cadabra, Inc. It is now a publicly listed company and trades on NASDAQ.

Also listed as one of the Big Four (together with Google, Facebook, and Apple), Amazon is highly regarded for its disruptive innovation, involvement in the smart cities initiatives across the globe, market capitalization, hyper-competitive application processes, and brand equity.

Currently, Amazon is listed as the most valued public company worldwide. It comes first ahead of the big fishes Apple and Alphabet (the parent company of Google Inc.).


What is Costco?

Costco, trading as so, is registered as Costco Wholesale Corporation, an American Multinational corporation. Costco runs a chain of warehouse clubs that are membership-only in nature in addition to other stores.

Headquartered in Issaquah, Washington, Costco opened their first warehouse in 1983 in Seattle. Nevertheless, Costco’s history goes back to 1976, and through mergers, it has become Costco Wholesale Corporation. Costco comes at number 15 on the rankings of the Fortune 500. Fortune 500 ranks United States corporations based on their total revenue.

The corporation is also listed on NASDAQ.


Differences Between Amazon and Costco

The main differences between the two corporations are as expounded below:

  1. Founding

Amazon.com, Inc., was founded on July 5, 1994, as Cadabra, Inc., while Costco Wholesale Corporation was founded on September 15, 1983.

  1. Founder

Amazon was founded by the current CEO, president, and chairman Jeff Bezos while Costco was founded by Jim Sinegal and Jeffrey Brotman.

  1. Headquarters

Amazon is headquartered in Seattle, Washington, U.S while Costco Wholesale Corporation has its headquarters in Issaquah, Washington U.S. However, Costco had the first warehouse located in Seattle when it first opened in 1983.

  1. Subsidiaries

The subsidiaries of Amazon.com, Inc., include Amazon Air, Amazon Publishing, Amazon Books, Amazon Robotics, Amazon Studios, Amazon Logistics, Amazon Game Studios, Amazon Web Services, Amazon Lab126, IMDb, Goodreads, Audible Inc., Whole Foods Market, and Twitch.tv among others.

The subsidiaries and services of Costco include Costco Wholesale, Costco Travel, Costco Insurance Agency, Inc., Costco Online, Costco Wholesale International, Inc., and Costco Wholesale Corporation Voluntary.

  1. Products and Services

Amazon’s products and services include Amazon Web Services, websites, devices like Kindle Fire, digital including Fire OS, technology (including Amazon Robotics), publishing, retail, and logistics (including Amazon Air).

Costco’s products and services include Kirkland Signature, concierge services (including as a travel agent and investment broker), Costco Optical, Costco Auto Program, Costco business services (including payment processing), Costco Travel, online photo site, online shopping, food service, Costco business services.

  1. Revenue

Amazon’s revenue as of the fiscal year that ended on December 31, 2017, stood at $177.866 billion. The operating income dropped to $4.106 billion while the net income increased to $3.033 billion. The total assets and equity stood at $131.31 billion and $27.709 billion respectively.

Costco, on the other hand, had a revenue estimate of $129 billion by the end of the 2017 fiscal year. Its operating income had increased to $4.111 billion while the net income increased and hit $2.679 billion. Its total assets and equity were at $36.35 billion and $11.08 billion respectively.

  1. Employees

As of October 2018, Amazon’s employees were at a count of 613,300 while Costco had a total of 231,000 employees by October 2018.

  1. Membership

The two corporations have membership offerings with different specs. For Amazon Prime, the membership price is currently at $119 while Costco has a Gold Star Executive Membership which goes for $120. Both memberships are on an annual basis.

Amazon Vs. Costco: Comparison Table


Summary of Amazon verses Costco

Amazon and Costco are by far among the largest corporations mainly in e-commerce. The two have shaped the industry and managed to increase the faith of many shoppers in online shopping. Regardless of the many similar characteristics, they both have identifying qualities and properties that unless one is deeply concerned with digging for the same, it would be hard to differentiate them.


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References :

[0]Image credit: https://upload.wikimedia.org/wikipedia/commons/thumb/3/34/CostcoMoncton.JPG/640px-CostcoMoncton.JPG

[1]Image credit: https://upload.wikimedia.org/wikipedia/commons/thumb/7/70/Amazon_logo_plain.svg/500px-Amazon_logo_plain.svg.png

[2]"Amazon Prime And Costco Charge The Same Price For An Annual Membership — Here's Which One Is Better For You". Business Insider, 2019, https://www.businessinsider.com/costco-vs-amazon-prime-membership-which-one-is-worth-cost-2018-5?IR=T. Accessed 9 Jan 2019.

[3]Kline, Daniel. "Better Buy: Costco Wholesale Corporation Vs. Amazon -- The Motley Fool". The Motley Fool, 2019, https://www.fool.com/investing/2018/05/01/better-buy-costco-wholesale-corporation-vs-amazon.aspx. Accessed 9 Jan 2019.

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