How Does the Cultural Background Affect the International Business: A Readable Case Study of Costco in China Mainland

Abstract

When an international corporate enters a foreign business, it has to classify cultural differences to adapt to the new condition. For instance, customers with different cultural backgrounds would have different reactions to a new business. Cultural background may affect customer behavior and even further, international business. In 2019, one of the largest chains of the membership-only wholesale club, Costco, opened its first store in China in Shanghai. As an American multinational corporation, it is a typical case for researching the difference between consumers with different backgrounds, hence, this paper chooses Costco as the sample and makes a readable case study. The research of this study is mainly based on a questionnaire survey of 211 Costco customers and analysis of several events in China related to Costco. The result of the case study reflected the cultural attributes of foreign brands in the view of Chinese consumers and suggested how the international enterprises could attract Chinese consumers by their cultural attributes. The goal of this paper is to provide a reference for multinational enterprises, especially the enterprises of retail trade, consumer nondurables, and consumer durables, to plan their operations, branding, and marketing in China.