Tuesday, March 13, 2007

Costco: The 'anti-Wal-Mart'

A store that is the best in the world at saving its customers money and values all of its employees enough to pay 90% of health care insurance and above market wages. No wonder Costco has the lowest employee turnover in retail.

Some on Wall Street are now realizing this is actually a good formula. In previous years Costco had a negative reaction from many analysts because of its higher labor costs and lower margins on sales than the somewhat comparable Sam's Club. Costco results seem to speak for itself and now Warren Buffett has become one of its investors.
The warehouse-club retailer 'has figured out the big, simple things': Hold down expenses and prices, treat employees well, make discount shopping fashionable and keep shareholders happy.

1 comment:

Anonymous said...

It's the big picture. While many businesses look only at the quarterly or even yearly results and not much else, Costco has seen what in the long term works for them.