Costco: The Empire Built on Values
COSTCO: The Empire Built on Values
Costco’s co-founder and CEO, Jim Sinegal, went against traditional retail rationale by firmly prioritizing his values to cater to his consumers and employees first and foremost; and even after 30 years of prosperity, he sees no other way to earn confidence and build loyalty. Costco, the third largest retailer in United States, is operated under the warehouse club concept that simply runs on providing department store quality at bargain store prices. Sinegal’s foundation for his business is defined by his delivery of high standards of ethics and his ‘no room for shortcuts’ commitment to do the right thing: “we look at [selling] and we say, ‘Selling this thing for ten bucks, how do I get it to nine? And then if I get it to nine, how do I get it to eight?’” This technique strives to work deeper at the roots by negotiating prices with two or more businesses instead of just settling for making profit with one. Costco’s modus operandi is geared towards community development and is a great example of an unconventional successful based on honest to goodness effort that customers are eager to deal with; evident by their $100 billion in annual sales, nearly 600 warehouses, and 64 million members worldwide. Although Costco’s business plan was put through some major tests, the company’s principles remained consistent: the customer comes first! Costco started out as a daring new concept by a group of businessmen that were seeking investors in the San Diego area. Their plan involved a large warehouse style store that offers a wide range of goods in a “no-frills” setting: Fed-Mart, they called it. With hopes of reaching the top of the national retailer list, Fed-Mart’s concept was devastatingly shut down. The investors took this as an opportunity to enrich their concept and went on to incorporate a membership subscription to the warehouse idea. The first Costco was ready for business in Seattle when Jim Sinegal was chosen as
Costco’s co-founder and CEO, Jim Sinegal, went against traditional retail rationale by firmly prioritizing his values to cater to his consumers and employees first and foremost; and even after 30 years of prosperity, he sees no other way to earn confidence and build loyalty. Costco, the third largest retailer in United States, is operated under the warehouse club concept that simply runs on providing department store quality at bargain store prices. Sinegal’s foundation for his business is defined by his delivery of high standards of ethics and his ‘no room for shortcuts’ commitment to do the right thing: “we look at [selling] and we say, ‘Selling this thing for ten bucks, how do I get it to nine? And then if I get it to nine, how do I get it to eight?’” This technique strives to work deeper at the roots by negotiating prices with two or more businesses instead of just settling for making profit with one. Costco’s modus operandi is geared towards community development and is a great example of an unconventional successful based on honest to goodness effort that customers are eager to deal with; evident by their $100 billion in annual sales, nearly 600 warehouses, and 64 million members worldwide. Although Costco’s business plan was put through some major tests, the company’s principles remained consistent: the customer comes first! Costco started out as a daring new concept by a group of businessmen that were seeking investors in the San Diego area. Their plan involved a large warehouse style store that offers a wide range of goods in a “no-frills” setting: Fed-Mart, they called it. With hopes of reaching the top of the national retailer list, Fed-Mart’s concept was devastatingly shut down. The investors took this as an opportunity to enrich their concept and went on to incorporate a membership subscription to the warehouse idea. The first Costco was ready for business in Seattle when Jim Sinegal was chosen as