I definitely have a big store phobia. Then again, shopping with me under any circumstances is never a joy. Except for Costco. I just love the place, and always end up buying more stuff than intended.
I'm not alone. Most people love the place – except for Wall Street, that is. That's because Costco's pay scale and benefits are far better than say, Wal-Mart's. As Bill Dreher of Deutsche Bank notes in a recent New York Times article, "It's better to be an employee or a customer than a shareholder."
But Costco's low prices, respect for workers, and shrewd competitive philosophy are what keeps customers coming back. And Costco shoppers tend to be more affluent, while their workforce remains loyal. CEO Jim Sinegal took home just $550,000 last year – far lower than his peers at similarly sized companies. Why? In the same article, he explains, "I just think that if you're going to try to run an organization that's cost-conscious, then you can't have those disparities. Having an individual who is making 100 or 200 or 300 times more than the average person working on the floor is wrong."
Sinegal is building Costco not for the next quarter, but for the long haul. And is there a business more competitive than these big box wholesale operations? Imagine competing with Sam's Club, day in and day out. There are lessons to be learned from the way he is placing great emphasis on his customers, his product, and his employees – all values that work in any business. Even radio.
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