New Idea: Being Nice Pays Off

From my Costco file Alex, let me add these quotes from Richard Galanti and Jim Sinegal

“We always want a wide gap between us and the competition,” Coscto’s CFO Richard Galanti told the Seattle Post Intelligencer. “It shows in the quality of our employees…It’s what our founders want to do in paying a family wage.”

Sam Walton however-

Wal-Mart founder Sam Walton once said, “I pay low wages. I can take advantage of that. We’re going to be successful, but the basis is a very low-wage, low-benefit model of employment.”
http://en.wikipedia.org/wiki/Criticism_of_Wal-Mart#_note-
iswalmartgood

“Is Wal-Mart Good for America?” PBS. November 16, 2004. Retrieved on February 24, 2007.

Indeed, Costco’s pay is much, much, much better-a full-time Costco clerk or warehouse worker earns more than $41,000 a year, plus getting terrific health-care coverage. Wal-Mart workers get barely a third of that pay, plus a lousy health-care plan. Costco even has unions!

Yet, Costco’s labor costs are only about half of Wal-Mart’s. How’s that possible? One reason is that Costco workers feel valued, which adds enormously to their productivity, and they don’t leave-employee turnover is a tiny fraction of Wal-Mart’s rapidly revolving door.

While Wal-Mart makes twice as much profit as Costco, Sinegal believes its better business to make a nice profit, but not a killing, and to invest more in Costco’s 92,000 workers. “I don’t see what’s wrong with an employee earning enough to be able to buy a house or having a health plan for the family,” he says.

Costco CEO Says Higher Minimum Wage Means ‘Better Jobs and Wages’
by Mike Hall, Jan 31, 2007

The Costco chief certainly knows what he’s talking about. His successful venture, launched in 1983, now has 130,000 workers and operates 504 stores, where the average worker makes $17 an hour and the lowest-paid earns $11 an hour. It’s good business sense says Sinegal.
http://blog.aflcio.org/2007/01/31/
costco-ceo-says-higher-minimum-wage-means-better-jobs-
and-wages/

“I don’t see what’s wrong with an employee earning enough to be able to buy a house or having a health plan for the family,”
Costco CEO Jim Sinegal

WalMart- “Mortgage paymets?” “Living wages?” ‘Health care benefits?” Those bastards at Costco are upsetting our whole program.

Huckabee, Norris and WalMart- A gloat, a dolt and a cult.

SanDiegoView,

This is an anti Wal-Mart site, not a pro Costco site.  If you want to brag on Costco, go to the pro Costco site.

Someone using my ID SDV, that last comment was not me. Some WM groupie no doubt. Keep up the good work SDV.

Thanks genuine Sick of Wal-Mart. Your effectiveness has another measure by the desperate need of the WalMart/Edelman trolls hijacking your handle. As for fake Sick of Wal-Mart, you obviously have an objection to the subject matter that the administrators of this site choose to visit upon and their free right of doing so. Besides, there has never been bragging about Costco at all, what troubles you it is the fact they exist at all and are doing so very well.

“Few things are harder to put up with than the annoyance of a good example.”
Mark Twain

ufcw local 135 in san diego where we have so many at the bottom end of the wage scale on food stamps and govt assistance because we screw them over and refuse to give them full time work and enough hrs and money to get them off welfare.got an answer on that sdv?you love ufcw so much.

You know I got curious as Matt is always bitching about how awful other grocery stores pay in San Diego.  So I did a quick search and found that a health food store there pays some of the best wages for that industry.  Check out the link.

http://hotjobs.yahoo.com/job-J9Q6GF1F9FN;_ylt=Atfs2kKWdLPClS0_77pK6x36Q6IX?search_url=/job-search-l-San_Diego-CA-k-grocery-m-2

I mean a pay range of $9-$20 seems a lot better than Walmart.  Although, these could easily be seen as slave wages when you take into acount the cost of living in California.

Way to go, “SUCKS”, you really put your foot in your mouth, this time!

I found this piece from the UFCW website which was more than noteworthy:

<url=http://www.ufcw135.org/workers/02_2004_worker.pdf>UFCW 135 Article</url> (Page 21)

At Jimbo’s, she’s making $10 an hour, $5 less than she was making at Ralphs(Kroger) but enough to keep her head above water.  After 60 days, the store will provide medical benefits for her, but not for her children.  She has applied for Medi-Cal for them.

Page 21

SanDiegoView -

“Besides, there has never been bragging about Costco at all, what troubles you it is the fact they exist at all and are doing so very well.”

That was the biggest laugh I’ve had all day, 80 percent of your posts BRAG on how Costco is so much better than Wal-Mart.  And, the fact that I own shares of Costco, proves I DO like the fact that they exist, they have been making me money.

REALLY Look Who got Screwed?  You found some info about someone making $15 an hour at Ralphs, a Kroger chain.

THANK YOU, now make sure MV reads about this considering every other post he is telling us stories about his sister making slave wages at the Ralph’s in San Diego and how those awful Union Grocery stores pay crap down there.

And to be fair to Sucks, they were only posting that to refute what Matthew has been saying about all other stores paying less than WM.

corgi in union grocery you have to work there around 10 to 20 years to qualify for full time work and get those 15 .oo an hr wages you claim.how many people have the patience at those union grocery stores to wait so long and hold on to reach that wage?most people dont have the time and patience and they shouldnt either to have to wait that long to make decent money.my sister is a manager for ralphs and they rarely ever according to her anymore promote baggers to checkers eliminating the oppurtunity to move up and get anywhere.baggers are told up front that if you want to get somewhere we will not be promoting you to checking.what a shitty way to treat their workers.the ones corgi making 15.00 an hr likely have been there 20 yrs or longer.according to my sister that unless you are lucky enough to be promoted to checker or store manager you are not going to make quality wages and if you want that this is not the place for you.this same crap went on in union grocery when i worked in it and my sister says it is still going on.many ralphs and other union grocer workers are on food stamps and welfare because of this.my sister got on food stamps and welfare as a regular worker because of poverty level wages.ufcw union grocers across america corgi pay crap wages and have more on food stamp and welfare doles than walmart does and their is no arguing on that one.

Ok I call for all anti WM posters on WMW to boycott Matthew. I say we also boycott WMW unless they boot Matthew from the site. Strength in numbers, lets get this done. Nobody acknowledge the existence of Matthew Vantress and everyone refuse to post unless Matthew is banned from WMW. We can do this people.

lets ban sick of because he stoops to the level of character assasanation and name calling. if someone posts pro walmart facts and views on here he dont like.and if you tell facts and true figures about other union grocers and retailers he loves he stoops to the childish level of character you know what.that is why we need to ban sick of from this site.i call on the smart ones to ignore sick of and his childish name calling and lies on wm.

Corgishepmom: It appears as though Mattress has a history of defending WM for some time now in the Oregon press, and criticizing other grocers and merchants, in the area,too.I would be curious as to the timeframe in which this agenda of allegiance was formed.

dude i have been posting on those blogsfor several months now.i am very opiniated on issues like retail ,wm and union grocery because i have exp working in those industries and know how they are run.

go check out local daily news.com and check out my other postings click on gresham outlook and portland tribune and check it out.

hey sdv thought you would like to know the average household income of the average costco customer is 70,000. a yr.which proves my point that you have to be spoiled and rich to shop there regularly unlike wm.costcos average wage is 17.60 an hr.which is based on a forty hr week which is a rareity in retail anywhere anymore 704.00 a week gross times 4 which is then 2816.00 times 12 which comes out to be 33,792.00 you take off 700.oo to 1000.00 a month for state and federal taxes and that leaves you with a take home of 23,000 to 26,000 a yr take home which leaves your argument that costco workers make 41,000 a yr full of crap and untrue.you dont factor in how many get full time work and how many get part time.very few are full time and i know this because my former mother in law works at costco and has for over 20 years its like union grocery in a way because you have to work there numerous years at part time before you can get full time work.its all done by seniority.i would hardly call costcos wages something to brag about.i would suggest in the future sdv before you go shooting off your mouth about how great costcos wages and benefits are you do better math and research.costco pays 90% of workers health care costs not 92% like you claim.also factor in that a lot of part timers cant get full time work for a long time either.most other private sector companies including walmart and non union places pay 90% of employees medical premiums as well.i dont buy the propaganda on wms benefits and health care being that bad.most other places the average medical monthly premium for a single person is 20 to 70.00 a month depending on which company health plan you chose.wm offers several affordable health care premium plans contrary to what you folks claim and think.look it up.the bottom line costco employees are not as well paid and everything is not as rosy their as sdv claims.

hey sdv thought you would like to know the average household income of the average costco customer is 70,000. a yr.which proves my point that you have to be spoiled and rich to shop there regularly unlike wm.costcos average wage is 17.60 an hr.which is based on a forty hr week which is a rareity in retail anywhere anymore 704.00 a week gross times 4 which is then 2816.00 times 12 which comes out to be 33,792.00 you take off 3000.00 to 7000.00 for state and federal taxes and social security and that leaves you with a take home of 23,000 to 27,000 a yr take home which leaves your argument that costco workers make 41,000 a yr full of crap and untrue.you dont factor in how many get full time work and how many get part time.very few are full time and i know this because my former mother in law works at costco and has for over 20 years its like union grocery in a way because you have to work there numerous years at part time before you can get full time work.its all done by seniority.i would hardly call costcos wages something to brag about.i would suggest in the future sdv before you go shooting off your mouth about how great costcos wages and benefits are you do better math and research.costco pays 90% of workers health care costs not 92% like you claim.also factor in that a lot of part timers cant get full time work for a long time either.most other private sector companies including walmart and non union places pay 90% of employees medical premiums as well.i dont buy the propaganda on wms benefits and health care being that bad.most other places the average medical monthly premium for a single person is 20 to 70.00 a month depending on which company health plan you chose.wm offers several affordable health care premium plans contrary to what you folks claim and think.look it up.the bottom line costco employees are not as well paid and everything is not as rosy their as sdv claims.

Corishepmom in : I was just thinking,if Matt-ress spent as much time working ,as he does blogging,maybe he could afford to shop elsewhere,instead of WalMart!

Matthew,

Allow me to expound on a few of your points......

the average household income of the average costco customer is 70,000. a yr.which proves my point that you have to be spoiled and rich to shop there regularly unlike wm.

I had read a $50K a year household was Costco’s “core customer”.  Has that number been raised?  It doesn’t really matter, as Costco has made no bones about wanting customers who drop $150 in a single shopping trip.

costcos average wage is 17.60 an hr.which is based on a forty hr week which is a rareity in retail anywhere anymore

Amen - and furthermore, while that “average” hourly wage $17.60 makes for some damn good PR on Costco’s part, how many of the rank-and-file store employees are actually getting it?

That $17.60 could be reflective of a high-cost area such as San Francisco or Honolulu (where Costco operates large numbers of stores).

And while we’re at it, let’s not forget the part-timers, too.  I can say with confidence that nobody working part-time retail is making any more than $11 an hour.

i would hardly call costcos wages something to brag about.i would suggest in the future sdv before you go shooting off your mouth about how great costcos wages and benefits are you do better math and research.

I agree - SanDiegoView is full of something, all right.  Must’ve been something he bought/smoked from his last trip down to Tijuana.

costco pays 90% of workers health care costs not 92% like you claim.also factor in that a lot of part timers cant get full time work for a long time either.

Typically, part-timers of all stripes (regardless of who they work for/industry) can’t qualify for health coverage untl after some probationary period (usually one year).  Otherwise, the company would go broke providing health care to every Tom, Dick, or Harry coming in off the street to work a few hours.

the bottom line costco employees are not as well paid and everything is not as rosy their as sdv claims.

I dunno - I do know for a fact that if you are a Costco employee, you automatically qualify for their American Express card with absolutely no credit check (the only stipulation is that you can’t have a outstanding debt with AmEx).

My guess is Costco/AmEx offers-up the card, so that store employees can drop some of that hourly “$17.60” at the store, after work.  Makes good business sense on paper, and people love their plastic!

bbrd-

To borrow from your style, let’s look at the main article, shall we?

But as the five-year chart below shows, Wal-Mart’s stock has been a serious laggard of late. Meanwhile, its more socially conscious discounting cousin, Costco has been on a tear.

No doubt about that, but the “cousin” thing was a little over-stated.  Maybe a cousin to Sam’s Club, perhaps…

And it’s no secret that a share of COST is worth quite a bit more than WMT.

Over the past five years, shares of Wal-Mart have lost more than 10% of their value. Costco is up better than 100% over the same period.

Again, nothing we don’t already know.

A piece in the Seattle Post-Intelligencer sheds some light on the kinder, gentler corporate culture that is producing results for Costco.

You think?  Isn’t Seattle Costco’s hometown?  Always gotta stand by the home team…

And Sinegal even, gasp, donates large amounts of money to Democrats.

The single, common denominator, ladies and gents (and proof that politics is what motivates the “Costco vs. Wal-Mart” camps).

He tries to visit each Costco location at least once per year.

Not an impossible feat, since there are only a little under 500 locations, and about a fourth of those are not in the U.S.

Furthermore, “He has kept his salary at $350,000 for the past six years, a fraction of what most other Fortune 500 chief executives earn. He also turned down a $200,000 bonus last year because of disclosures of sloppy bookkeeping regarding company stock option practices, and he reimbursed the company $62,463 for using the company’s aircraft for personal use.”

As it should be...and I seriously doubt Wal-Mart execs are using corporate assets (aircraft) for personal use without also reimbursing the company.

As for the salary, perhaps Mr. Sinegal is being compensated in other ways (i.e., stock options)?  If you look back at Wal-Mart when it was a 500-store bagger, I am sure similar salary caps were in place there, as well (as that was before the age of the internet, all we have to go on is the ramblings of the critics).

But as the five-year chart below shows, Wal-Mart’s stock has been a serious laggard of late. Meanwhile, its more socially conscious discounting cousin, Costco has been on a tear.

Over the past five years, shares of Wal-Mart have lost more than 10% of their value. Costco is up better than 100% over the same period.

A piece in the Seattle Post-Intelligencer sheds some light on the kinder, gentler corporate culture that is producing results for Costco. The article is excellent and worth reading, but this one part of one sentence probably sums up the major difference between the two companies better than anything else: Chief Executive Jim Sinegal, the penny-pinching, self-effacing multimillionaire who is beset by handshakes, hugs and even kisses from employees.

It’s hard to imagine anyone hugging Wal-Mart CEO Lee Scott. Kicking him in the crotch? Perhaps. But certainly not hugs. And Sinegal even, gasp, donates large amounts of money to Democrats. He tries to visit each Costco location at least once per year.

Furthermore, “He has kept his salary at $350,000 for the past six years, a fraction of what most other Fortune 500 chief executives earn. He also turned down a $200,000 bonus last year because of disclosures of sloppy bookkeeping regarding company stock option practices, and he reimbursed the company $62,463 for using the company’s aircraft for personal use.”

Is it just me...

Yeah, BloggingStocks, it’s “just you”, as you are owned by AOL, who, in turn, is owned by TimeWarner, which is basically another left-leaning outfit...you get PAID to do this sort of thing…

A lot of words to say absolutely nothing, Retail Watcher. If you’re not getting paid by the word you might consider brevity.

...which is basically another left-leaning outfit...

The Great Left Wing Conspiracy, no doubt. There’s always room at WMW for a poster with a sense of humor, RW.

why should anyone including customers have to pay a fee of 50 to 60 dollars a year to shop at costco or anywhere else?costco is very spendy compared to walmart and attracts the elite wealthy class compared to wms low to middle class.costco imports and sells darn near all their merchandise from china,bangladeesh and etc.lets hold costco responsible for toy recalls instead of picking on wm because costco always sells the same poisonous toys everyone gripes at walmart for.

P.S. I just want you to know, matthew, you have <b>finally</b made it into my Keeper File with this truism:

i am very opiniated. . . ~ matthew vantress

Retail Watcher in : Re: Blogging Stocks being owned by AOL,i.e.,Time Warner-For the sake of balance,let us not forget the two hour infomercial ,"The Age of Walmart”, produced by MSNBC,an NBC affiliate,who is owned by General Electric, who has ties to WalMart via G. E.Capital,who services WalMart credit cards....that should take care of the right wing contingency-are the scales tipping a bit more evenly,now?

ddrb,

But, of course, Blogging Stocks is correct, so you can trust what they say and MSNBC is incorrect, so what they say can’t be trusted, right?  Oh, by the way, didn’t David Favor win some journalistic Awards for that “Age of Wal-Mart” piece?  Must be part of the conspiracy, right?

Tommy in : Please reread my post.I have made no such judgment or assumption-just stating the facts. Let people evaluate for themselves! I’m unaware of any award-singular,or plural,as you say. Possibly-but ,I really think you have the reporter’s name incorrect.

ddrb,

You are right, his name is David Faber, sorry.  I believe he recieved 3 awards for that documentary.

Hey Tom Boese, how many journalistic awards did that anti Wal-Mart documentary you were involved with get?

RDS: Oddly enough,speaking of Blogging Stocks,David Faber produced in 2003,a documentary entitled,"The Big Heist-How AOL Took Time-Warner” for CNBC.He was nominated for an Emmy,and a Maxell award on this documentary. He won a Peabody for the Age of WalMart,which came after “The Big Heist” doc of 2003.

Trust who you will Tommy. The charts speak for themselves on stocks. As do facts from Sam Walton’s own mouth-

Wal-Mart founder Sam Walton once said, “I pay low wages. I can take advantage of that. We’re going to be successful, but the basis is a very low-wage, low-benefit model of employment.”
http://en.wikipedia.org/wiki/Criticism_of_Wal-Mart#_note-
iswalmartgood

“Is Wal-Mart Good for America?” PBS. November 16, 2004. Retrieved on February 24, 2007.

But again as I mentioned this set of facts elsewhere- $50 million in profits may sound great but is only a very small fraction of $50 billion in revenue increase, one tenth of one percent (.1) against an inflation rate Bush clocked at far less than the actual rate of 9-12 percent. No wonder WalMart had to scale back plans for opening stores in the U.S. this year and the stock is in the toilet.

If you owned WaMart stock over the past five years, you would have lost at least 40-50 percent in value compared to maintaining equivalent dollar value and the dividend does not make up for what could have been made in owning other stocks that have gained rather than being stagnant like the WalMart 5 year chart. Increased revenue but the stockholders are losing value even under the ruthless employee exploitation model that comes out of Bentonville inclusive of the government public subsidies sponge that WalMart exercises. Under the current leadership- WalMart business philosophy will have another banner year in 2008 screwing over employees and taxpayers while shareholders take another loss. You can forget about any kind of relative financial gain in holding onto WalMart stock.

“Few things are harder to put up with than the annoyance of a good example”
Mark Twain

SDV: Didn’t WalMart just announce a 30% expansion in China? I think I saw that one of the the new threads at the beginning of the blog. Would the rate of exchange between the U.S. dollar and the Chinese currency have an effect on the W/M stock value, with the expansion of Chinese W/M’s? Would it enhance or devalue it,in your opinion? Thanks.