Forum Archive Index - February 2003

["Allan Potts" <ajp7079@excite.com>]

It appears to me that the reason WHS had it's share price fall off a cliff was 
made public yesterday by a STUFF article.  It reported that COSTCO executives 
had been in NZ over the weekend using a helicopter to scout for sites for the 
possible development of COSTCO stores.  The STUFF article pooh pooh'd the 
threat of COSTCO competition, but I think they got it wrong.  Evidently the 
market also thinks they have it wrong.

COSTCO is a 900 pound gorilla and if they stick it out in NZ, I think they will 
be very successful.  The article plays down COSTCO because they sell in bulk.  
Well yes and no.   Many items are in bulk, however thousands of items are not.  
Their  prices are absolutely the best I've seen in the world and are a great 
boon to consumers.  The concept started out with the PRICE CLUB, founded by a 
San Diego attorney turned developer/merchandiser -- Sol Price.  The concept 
started off very slowly, until business people  found out they could by their 
goods at better  prices than they were getting at their wholesale distributors. 
 Then the public caught on and gradually the concept took off.  The individual 
who started COSTCO used to work for and was trained by Sol Price.  Later on The 
PRICE CLUB  and COSTCO merged and was called PRICE/COSTCO.  Finally COSTCO 
bought out the entire thing and renamed it COSTCO.

Looks like the TA  guys really were ahead of the curve on this one as the sell 
signal was given when it crashed through support at $7.00.  It went so fast I 
didn't get out.  Finally the news comes out that evidently was known to some 
select biggies somewhere.  As I said in my first post OUCH!!!

Since I'm not on the ground there I really can't judge the ability of WHS to 
withstand the fierce competition that COSTCO would bring in NZ and Aussie.

Any thoughts from the troops on the ground??

Allan






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