Wal-Mart Executives Take Three Spots in Top Ten Retail Salaries

WOuldnt it make sense that the largest most profitable company in the world would have the top paid exectutives. I think Lee Scott’s story speaks to the greatness and opportunity afforded by individualistic capitalistic society. As a son of a gas station owner, he demonstrates what hard work and effort can achieve.

Who am I to say what somewhat else should make? Who am I to set someone’s elses pay?

Lee Scott and other Wal-Mart executives make top retail salaries while their “associates” make next to nothing. How fair is that? What Wal-Mart executives have failed to realize that if it weren’t for their ASSOCIATES THERE WOULDN’T BE A WAL-MART! Are Wal-Mart executives going to wait on customers, work the registers, stock the shelves, clean the store, and greet customers every day in one of their stores? I think not. They’re going to sit behind their office desks making decisions. But as far as having DAILY CONTACT with their customers--think again.
Sam called his employees “associates” to make them feel part of his company. But the term “associates” is pretty much a joke now. The average Wal-Mart employee LEAVES AFTER ONLY 3 MONTHS ON THE JOB! This is according to Al Norman who wrote the books “Slam Dunk Wal-Mart” and “The Case Against Wal-Mart.”
Wal-Mart associates deserve to receive much more pay but they will NEVER SEE IT. Wal-Mart is well know for being cheap to their very bone. And one of the ways to save a bundle is to pay your employees next to nothing unless you absolutely have to.
Yes, other companies do the same thing Wal-Mart is doing. But you would think they would try to set the example here and pay their employees a living wage. Apparently, that is not the case.
I wonder how much Wal-Mart executives would scream if they had to live on what their associates make in a year?

Jane in : It looks like Sears holdings must be doing better than we’re led to believe .

Jane
Is anyone forcing the associates to work at Wal-Mart? I am correct in saying that they do have the choice.  If they can make more $ with better benefits somwhere else, they are free to leave. It’s alot better than complaining about it.

Jane,

What you ‘class envy’ people don’t take into account, are things you yourself have stated!!  You say, “Lee Scott and other Wal-Mart executives make top retail salaries while their “associates” make next to nothing. How fair is that?”, it has nothing to do with ‘fairness’, it has everything to do with responsibility!!  If an employee fails to do their job correctly, it will not be that big of a deal, but, if the CEO, who sits “behind their office desks making decisions” fails to do their job correctly, it could cost both the company and the employees as well, millions of dollars and possibly their and their employees jobs!!

“The average Wal-Mart employee LEAVES AFTER ONLY 3 MONTHS ON THE JOB!”

Well, how does one expect to get to a higher level, when they ‘quit’ after only 3 months on the job?  Just when a person starts to go up, they quit and have to start at the bottom again, somewhere else!!  Who’s to blame for that?

“And one of the ways to save a bundle is to pay your employees next to nothing unless you absolutely have to.”

Why would ‘anybody’ pay more for something, than they HAVE TO?  Would YOU?  If you went to buy a car and the sticker price was $18,000.00, would you say to the dealer, “That price is too cheap, I want to pay MORE”?  The main way, to get Wal-Mart to raise pay rates, is to decrease the ‘supply’ of workers, until that happens and people are willing to work for what Wal-Mart pays, why should they raise wages?  Remember, they are a business, not a charity!!  Besides, isn’t it the job of the CEO and executives, to maximise profits?  They are just doing their job, correctly and deserve to be rewarded for it!!  Putting cans on a shelf, is no comparison to making billion dollar decisions!!

“What Wal-Mart executives have failed to realize that if it weren’t for their ASSOCIATES THERE WOULDN’T BE A WAL-MART!”

And, what YOU fail to realize, is that without Wal-Mart, there would be no Wal-Mart employees!!  Here’s the difference, if ALL the Wal-Mart workers were to quit tomorrow, within a week, Wal-Mart would be able to replace those employees, but, if Wal-Mart were to shut their doors tomorrow, most of the employees would still be unemployed 6 months from now!!  So, the employees need Wal-Mart, more than Wal-Mart needs it’s current employees!!  They have a 50% turnover rate and manage to keep running!!

BTW:  I believe that Lee Scott DID used to “wait on customers, work the registers, stock the shelves, clean the store, and greet customers every day in one of their stores”, the main difference between him and others, is that he DIDN’T “LEAVE AFTER ONLY 3 MONTHS ON THE JOB”, he worked his way to the top instead!!

COVER STORY:
Executive Compensation
June 21, 2002 Episode no. 542 July 18, 2008


BOB ABERNETHY, anchor: Now, a growing debate: How much should a chief executive be paid? Anything he or she can get? Or is there something morally wrong with $50 or $100 million salaries, especially when the value of a company’s stock is going down? Some people of faith say wealth is a sign of God’s blessing. Others say it’s the root of all evil and that no one ever got to heaven by getting rich. Lucky Severson reports on the reasons some Americans are paid so much.

“ what about corporate leaders—those captains of commerce and industry? In the year 2000, the average CEO of a major corporation made more than 500 times the average factory employee. But is the CEO worth that much more than the workers? Is his contribution to the company that much greater?

There are different ways of justifying what we pay someone. What is a person’s worth to an organization? Their contribution to society? What does it take to get the most qualified people, giving their best performance in a competitive society? What works? And what’s fair? And are they two different things?

SEVERSON: Graef Crystal was one of the top pay consultants in the business world until he grew disillusioned with the close relationships between boards and CEOs.

Mr. CRYSTAL: Your standard-issue board consists of ten friends of the CEO. In effect, he can tell the board whatever he wants because the board is stuffed with his friends, or two thirds of the members of the board are CEOs of other companies and they don’t come to the table with a philosophical predisposition toward low pay. On the contrary, they love high pay.

SEVERSON: The modern CEO makes most of his money on stock options, not salaries and bonuses. Options became popular in the ‘80s. One theory was that giving the boss a bigger share in the company would also give him more incentive to succeed. But what if that CEO doesn’t perform so well? In the year 2000, these were the companies with the highest paid CEOs. Here’s what the bosses made.

If you had invested $1,000 in each of these [10] companies, by year end your $10,000 would have dropped to a little over $8,000. You’d have done better investing in the S&P;500.

What if a CEO is bringing in a pay package of, say, $200 million, and yet for the last—during his tenure his company has not performed very well?
In that case, the board of directors is not doing its job.

SEVERSON: Tax laws make it more attractive for boards of directors to compensate an executive with lots of stock options, instead of salary. That gives the CEO a strong incentive to make sure the stock price goes up. You might expect that CEOs are so highly paid because good ones are in short supply. But maybe they aren’t.

Mr. FAY: There’s just not a whole lot of good CEOs and not a lot of good CEO material available. As a shareholder, I don’t mind the money. I just want value for the money.

Mr. CRYSTAL: Funny, you know, the quality business schools—Harvard, Stanford, Berkeley—are turning them out by the hundreds and have been for 25 years. If there’s this huge increase in supply of available qualified candidates and there’s a decrease in the demand for the number of people running these huge megacompanies, then shouldn’t pay be dropping, in a classic economic sense, rather than rising at such an exponential rate? And the answer is yes, it should be dropping. But it isn’t.  (continued)
.

(continued) What if a CEO is bringing in a pay package of, say, $200 million, and yet for the last—during his tenure his company has not performed very well?
In that case, the board of directors is not doing its job.

SEVERSON: Tax laws make it more attractive for boards of directors to compensate an executive with lots of stock options, instead of salary. That gives the CEO a strong incentive to make sure the stock price goes up. You might expect that CEOs are so highly paid because good ones are in short supply. But maybe they aren’t.

Mr. FAY: There’s just not a whole lot of good CEOs and not a lot of good CEO material available. As a shareholder, I don’t mind the money. I just want value for the money.

Mr. CRYSTAL: Funny, you know, the quality business schools—Harvard, Stanford, Berkeley—are turning them out by the hundreds and have been for 25 years. If there’s this huge increase in supply of available qualified candidates and there’s a decrease in the demand for the number of people running these huge megacompanies, then shouldn’t pay be dropping, in a classic economic sense, rather than rising at such an exponential rate? And the answer is yes, it should be dropping. But it isn’t.

SEVERSON: Executives in Japan and Western Europe aren’t paid nearly as much as they are here. But they may have different perks or higher status. In some places there are government or cultural controls. Not here.

SEVERSON: The bottom line, some say, is that Americans don’t care that much about the sky-high pay of CEOs as long as we think we all have an equal chance at getting rich. Political scientist John Kingdon.

Professor JOHN KINGDON (University of Michigan): We have a distinctive view of equality. We don’t really think of equality as equality of result. We think of equality [as equality] of opportunity.
.

SEVERSON: Shareholders vote on the boards of directors, who rarely reject a pay package. Pressure for change could come from the big institutional investors—the pension funds and mutual funds, for example. But according to Graef Crystal, most of them aren’t concerned about CEO pay as long as they are getting a good return themselves.

Mr. CRYSTAL: The issue here is not going to be solved until the shareholders rise up and smite the boards of directors who don’t do the right thing. That is to say, vote them out of office and throw them out into the street.
.

SEVERSON: And what about the pay of CEOs compared to teachers or nurses or policemen? Is the CEO’s contribution to society so much greater than theirs? Apparently that’s not a national concern. Government controls on executive compensation do not appear to be a likely prospect.

SEVERSON: Some Americans may be upset about the spiraling trend of CEO pay, but as long as the economy is healthy and people are gainfully employed, they may not be upset enough to demand a cap on what is viewed as the American dream: getting rich.

For RELIGION & ETHICS NEWSWEEKLY, I’m Lucky Severson.
PBS~~~~~~~~~~~~~Note: This was an article from 2000. Shareholders and others may share a different perspective on executive salaries and compensation ,now,eights years later-and the collapse of the economy.Hindsight is 20/20.

Would you be willing to take Scott’s job and salary at the cost of your soul?

A common theme in western literature from Jesus onward.

Apparently there are always enough people saying yes that the topic never gets old. I assume this also means they don’t believe in the devil or an afterlife.

It also means they have no sense of shame.

Who am I to say what somewhat else should make? Who am I to set someone’s elses pay?

Tim in Indy
Thursday, July 24 at 11:53 AM~~~~~~~~~~Tim, in that case,how are ANYONE’S wages set? How are your wages determined?

It has always amazed me, that people will complain about what they DON’T like and not say a word about things that they do like!!  Gates and Bloomberg want to outlaw smoking, but say nothing about outlawing drinking (Probably because they drink, but don’t smoke) and others decry smoking, but parade for the legalization of pot!!  Now, it is CEO pay, “It’s too high”, but what about those football, basketball and baseball players who get millions of dollars in contracts?  And, are they paid for performance, many get huge salaries and never go out on the field?  Where is the outcry about that?  Oh, I forgot, people LIKE football, basketball and baseball, so, it’s okay for sports figures to make tons of money!!  And, let’s not forget Actors/Actresses, who make millions per movie, or Rock stars who get thousands for a 2 hour concert, how much is that per hour, compared to what their fans make?

Do we really want to put a cap on how much someone can make a year?  Isn’t that against the American Dream people keep talking about?

I guess you didn’t get the memo RDS…

The American Dream got outsourced to China, India and now even Mexico.  In the not so distant future we could very well be jumping the fence to go work down there for companies like Freightliner.

But hey, who cares about us cry babies struggling to fill our tanks with gas and put food on the table.  I mean as long as big CEO’s get inflated salaries because they climbed up that corporate ladder on the backs of people that actually break a sweat for a living.

Let me translate that for you imbecile #1 (RDS) into your WalMart corporate libertarian worship language of Assholese.

You will never get the message because you are a WalMart propagandist internet troll/fraud/fake and hick sleazebag deceiving the American public.

You never gave a crap about The American Dream getting outsourced to China, India and now even Mexico. You wish you could speak more Spanglish sometimes so you could get a better job yourself down in Little Rock.

Neither you or Lee Scott could shed a tear in reciting the Pledge of Allegiance or singing God Bless America because your ‘love of money’ psychopath attitude won’t allow it. What is possibly wrong with stealing from labor or the stockholders with excessive salaries, stock options and benefits packages under the moral relativism business model? Actual work is for suckers. Let’s trade some paper.

SDV,

Do you even know what the American Dream is?  It’s NOT what you think with your communal/welfare/share the wealth mindset!!  What the American Dream is, is that anyone, who is willing to work hard, save their money and have a goal to chase after, can go as far in life as they choose!!  It’s NOT begging for others to do it for you!!

“The American Dream getting outsourced to China, India and now even Mexico.”

NO, the American Dream is NOT getting outsourced, those are those countries dreams!!  Why is it that we are being flooded with illegal aliens?  Mainly because they have little opportunity in their country, we can change that, by allowing their country to catch up with our economy!!  The American Dream is alive and well in this country, for those who put forth the effort to follow it!!

“But hey, who cares about us cry babies struggling to fill our tanks with gas and put food on the table.”

Maybe, if you cry babies, would buy a bike, instead of driving your car to the corner and would STOP shopping at the ‘high priced’ stores and started shopping at Wal-Mart, you too could afford gas and groceries!!  And, lastly, don’t quit your job after 3 months, and put forth the effort to EARN your raises, instead of whining about how someone makes more than you do and you think that they should ‘share’ their earnings with you.  Most people are able to support themselves without crying, why can’t you?

“Now, with the Walton Family’s stake in the company that Sam Walton founded, that sizable fortune rests quite a bit on the stock price of the company (WMT shares closed at $57.92 last Friday). While billions of dollars have been added to the bottom line of the retailer’s controlling family, the average worker in one of its stores has gotten poorer. To add insult to injury, Chinese employees are seeing raises and other perks that, at some point, could rival the pay and benefits U.S. Wal-Mart workers see. Is the American worker just being dumped on here? It could certainly be seen that way, but I digress.

If Wal-Mart could ever succeed in silencing its critics, it would be to become a leader in the retail space insofar as worker pay, benefits and other perks. Compared to competitor Costco Wholesale Corp., which seems to be the anti-Wal-Mart in terms of a big-box retailer which apparently knows the TRUE VALUE of treating employees fairly (which is above legally), Wal-Mart is abysmal. That doesn’t mean it couldn’t be way better in terms of labor relations—something that would actually make employees be happy when coming to work. ~~~Blogging Stocks~~~~~WUW~~~~~~~~~~

To recap RDS, your American Dream-

Recession, depression, extortion, economic conscription, outsourcing jobs overseas, wage slaves, living wages, social responsibility, market manipulations, corporate welfare, insider trading, back dating options, corporate bailouts, resource raping, dumping ‘associates’ onto the states for health care, millionaire and multi-millionaire and billionaire and multi-billionaire tax cuts, business monopoly, anti-trust legislation, exploitation of labor, ruthless business practices, supplier extortion, trade deficit, Global Labor Arbitrage, spying on employees and stockholders and reporters, the poverty cycle, home foreclosures and downward pressure on wages, elimination of workers benefits, union busting, WalMart/Edelman ‘war room’ propaganda fakes and trolls, ignorant and deliberate internet dismissives of labor/people, U.S. economic patriotism are all meaningless to you because you have the dead conscience of a libertarian psychopath whore.

“The shepherd drives the wolf from the sheep’s throat for which the sheep thanks the shepherd as his liberator, while the wolf denounces him for the same act as the destroyer of liberty.”
Abraham Lincoln

Compared to competitor Costco Wholesale Corp., which seems to be the anti-Wal-Mart in terms of a big-box retailer which apparently knows the TRUE VALUE of treating employees fairly...

Oh, really?

http://genderclassactionagainstcostco.com

Could’ve fooled me…

By STEVEN GREENHOUSE and MICHAEL BARBARO
Published: January 12, 2007
A federal judge granted class-action status yesterday to a lawsuit filed on behalf of more than 700 female workers at Costco Wholesale claiming that the retailer had systematically discriminated against women seeking jobs as managers.

In the lawsuit, the lead plaintiff — a former assistant store manager who was upset about not being made a store manager — asserts that Costco discriminated against women in promotions because 13 percent of the company’s store managers were women, while nearly half of its employees were women.

The lawsuit undercuts Costco’s image as one of retailing’s most benevolent companies, with generous wages and benefits that make it more attractive for employees than competitors like Wal-Mart Stores.

In her ruling yesterday, Judge Marilyn Hall Patel of Federal District Court in San Francisco concluded that the case should be certified as a class action because “plaintiffs have presented strong evidence of a common culture at Costco which disadvantages women.”

The lawsuit, filed in August 2004, contends that at Costco, the highest-paid store management positions — assistant general manager and general manager — are doled out through an informal, word-of-mouth system that favors men over women.

Unlike most competitors, Costco neither posts openings for such positions nor accepts applications for them, the lawsuit said. Instead, it said, a largely male group of senior executives handpicks managers.

Brad Seligman, the plaintiffs’ lead lawyer, said, “Costco has a blind spot in its employment policies, which has allowed a glass ceiling to fester.” He called on the company, based in Issaquah, Wash., to start posting jobs and to adopt objective standards to determine who should qualify to be a store manager.

Richard A. Galanti, chief financial officer at Costco, declined to remark on yesterday’s ruling, saying the company does not comment on lawsuits. With 370 stores and 90,000 employees in the United States, Costco is the nation’s largest warehouse store chain.

In the past, Costco has denied any discrimination. The company gave the judge statistical studies asserting that women were not underrepresented in managerial positions and that if they were, it was limited to two regions. Two experts hired by Costco asserted in declarations that any gender disparities that might exist were based on factors like women’s lack of interest in jobs requiring early morning hours.

In what the lawsuit said was the embodiment of a “paternalistic” system of promotions, Costco maintains an office inside its headquarters, called the Green Room, where the photographs of up-and-coming leaders are posted. Only senior managers have access to it, the suit said.

As a result of this and other practices, the lawsuit maintains, women make up only 12.9 percent of store managers and 16.6 percent of assistant managers at Costco, although they represent 45 percent of the chain’s employees.

In a deposition, James D. Sinegal, Costco’s chief executive, said that, more than men, women chose not to take management positions within the company, preferring jobs like cashier. “Our experience is that the women have a tendency to be the caretakers and have the responsibility for the children and for the family,” he said, according to the lawsuit.

Judge Patel ruled that the class of plaintiffs in the case should consist of all current and former female employees nationwide who have been denied store manager or assistant store manager positions since Jan. 3, 2002.

Mr. Seligman is also the lead lawyer in a sex discrimination lawsuit against a Costco rival, Wal-Mart. In that lawsuit, federal courts have granted class-action status on behalf of 1.6 million current and former female employees, making it the largest employment-related class action in the nation’s history. Wal-Mart is appealing that class certification~~~~If you have an issue with Brian White’s(Author) characterization of Costco vs, WalMart,take it up with Blogging Stocks. Two wrongs don’t make a right. If this is what corporate America requires to adjust its attitude,so be it...irresepective of the company.

8/14/2004 – SAN FRANCSICO - Shirley “Rae” Ellis, a Costco assistant warehouse manager, filed a national sex discrimination class action lawsuit against Costco on Tuesday, accusing the company of discriminating against women in promotions to store manager.

The lawsuit, filed in a U.S. District Court in San Francisco, charges that Costco imposes a “glass ceiling” that denies women promotions to high paying assistant and general store manager positions. The lawsuit is seeking class-action status to represent current and former Costco workers across America who have been subjected to gender discrimination.

“There is no clearer example of a glass ceiling than how Costco promotes workers into assistant manager and general manager positions,” said Brad Seligman, executive director of The Impact Fund, lead counsel for Ms. Ellis. “There is no promotion system at Costco - women must rely on the subjective and arbitrary decisions of Costco’s all male senior management. Not surprisingly, the men at Costco get a better deal when it comes to promotions.” Mr. Seligman is also lead counsel in the landmark case of Dukes v. Wal-Mart, which a federal judge recently certified as a national class action.

Costco operates approximately 324 warehouses in the United States employing over Less than 1 in 6 of Costco’s senior store managers are women, yet its workforce is nearly 50% female, the Impact Fund said in a statement.

The complaint charges that Costco has no job posting or application procedure for assistant manager and general manager positions, nor any written promotion standards or criteria for these jobs, in contrast to lower level jobs. The lawsuit alleges that under this “non-system,” discriminatory conduct is allowed to flourish. Higher-level management at Costco is virtually all male - all of Costco’s operations vice presidents are male, and only 2 of its 33 executive and senior officers are female, according to the filing. It is believed that over 650 current and former Costco female employees were eligible for promotion to the assistant and general manager positions over the preceding three years, the Impact Fund said.

“The best paying jobs at Costco are for general managers, who are typically paid $100,000 or more in salary and bonuses and are eligible for stock options worth many times this amount,” explained Bill Lann Lee, a Lieff Cabraser partner and the former Assistant Attorney General for Civil Rights, U.S. Department of Justice. “Even though women hold nearly half of the lower level jobs at Costco, women hold less than one in six of the senior store manager positions.”

Ms. Ellis, a former general manager at a Sam’s Club, said she was promised rapid promotion at Costco when she joined it in 1998. Despite these assurances and a record of excellent performance reviews, Ms. Ellis claims she was repeatedly denied promotion to warehouse manager positions, including many openings in California that she only learned about after they were filled.

After Ms. Ellis filed her charge of discrimination with the U.S. Equal Employment Opportunity Commission (EEOC), the complaint alleges that Costco retaliated against her by transferring to new warehouse far from her residence, requiring a multi-hour commute.

The Costco Sex Discrimination Lawsuit entitled: Ellis v. Costco Wholesale Corporation, Case No. C-04 3341 MHP, is seeking lost pay and benefits, damages and injunctive relief for the class~~~~~~~~~~~~~~~~~~WPN

“How Costco Became the AntiWalMart”,by Steven Green house ,New York Times,2005~~~~~~~~~~~~~(Excerpt):If Jim Sinegal feels proprietary about warehouse stores, it is for good reason. He was present at the birth of the concept, in 1954. He was 18, a student at San Diego Community College, when a friend asked him to help unload mattresses for a month-old discount store called Fed-Mart.

What he thought would be a one-day job became a career. He rose to executive vice president for merchandising and became a protégé of Fed-Mart’s chairman, Sol Price, who is credited with inventing the idea of high-volume warehouse stores that sell a limited number of products.

Mr. Price sold Fed-Mart to a German retailer in 1975 and was fired soon after. Mr. Sinegal then left and helped Mr. Price start a new warehouse company, Price Club. Its huge success led others to enter the business: Wal-Mart started Sam’s Club, Zayre’s started BJ’s Wholesale Club and a Seattle entrepreneur tapped Mr. Sinegal to help him found Costco.

Costco has used Mr. Price’s formula: sell a limited number of items, keep costs down, rely on high volume, pay workers well, have customers buy memberships and aim for upscale shoppers, especially small-business owners. In addition, don’t advertise - that saves 2 percent a year in costs. Costco and Price Club merged in 1993.

“Jim has done a very good job in balancing the interests of the shareholders, the employees, the customers and the managers,” said Mr. Price, now 89 and retired. “Most companies tilt too much one way or the other.”

This knack for seeing things in a new way also explains Costco’s approach to retaining employees as well as shoppers. Besides paying considerably more than competitors, for example, Costco contributes generously to its workers’ 401(k) plans, starting with 3 percent of salary the second year and rising to 9 percent after 25 years.

ITS insurance plans absorb most dental expenses, and part-time workers are eligible for health insurance after just six months on the job, compared with two years at Wal-Mart. Eighty-five percent of Costco’s workers have health insurance, compared with less than half at Wal-Mart and Target.

Costco also has not shut out unions, as some of its rivals have. The Teamsters union, for example, represents 14,000 of Costco’s 113,000 employees. “They gave us the best agreement of any retailer in the country,” said Rome Aloise, the union’s chief negotiator with Costco. The contract guarantees employees at least 25 hours of work a week, he said, and requires that at least half of a store’s workers be full time. 

© 2005 New York Times

© 2007 ReclaimDemocracy.org~~~~~~~~~~Note: Sam Walton admitted to “borrowing” Sol Price’s “Price Club” concept as a template for Sam’s Club-and told Sol,so,according to “In Sam We Trust”,by Bob Ortega. Although different in temperaments and terms of generosity towards others,including employees-Price being far more benevolent-there was much in common,especially the spirit of competition between the two.And both ,in later years, personally learned that wealth couldn’t buy health.

I find it interesting that the plaintiff who filed this Costco suit was employed at Sam’s Club prior to joining Costco. Additionally, the reading of the action itself seems to indicate more of a dissatisfaction with the procedural process in place for promotion. I see NO allegations of off-the-clock violations as in Dukes v.WalMart.  It will be interesting to compare and contrast the two suits .

Some interesting miscellaneous trivia about Costco:~~Trivia.  (June 2007)

The very first Price Club location was an old airplane hangar, previously owned by Howard Hughes, and is still in operation today (Warehouse #401 San Diego).
Prior to the 1993 Price Club/Costco merger, Wal-Mart founder Sam Walton wanted to merge Sam’s Club with Price Club.
In 2002, Costco surpassed $600 million in sales of wine becoming the largest wine retailer in the United States.
Costco became the first company ever to grow from zero to $3 billion in sales in less than six years. 
Costco Optical ranked as the fourth-largest optical company in the US.
The ACSI (The American Customer Satisfaction Index) named Costco number one in the retail industry with a score of 81 in 2006. 
A Costco Warehouse in Albuquerque, New Mexico was used in the filming of the 2006 film Employee of the Month, starring Dane Cook and Jessica Simpson. In the movie, the warehouse is given the name Super Club.

Working at Costco
While some former Price Club locations in California and the northeastern United States are staffed by Teamsters, the majority of Costco locations are not unionized. The non-union locations have revisions to their Costco Employee Agreement every three years concurrent with union contract ratifications in locations with collective bargaining agreements. Similar to a union contract, the Employee Agreement sets forth such things such as benefits, compensations, wages, disciplinary procedures, paid holidays, bonuses, and seniority. As of March 2008, non-supervisory hourly wages range from $11.00 to $19.75 in the United States and 11.00 to 21.85 in Canada.

Costco in the worldAs of June 18, 2008, Costco has 537 locations.

393 in the United States and Puerto Rico
75 in Canada
31 in Mexico (50-50 joint venture)
19 in the United Kingdom
8 in Japan
6 in South Korea
5 in Taiwan
Costco has announced that it will begin to open stores in Melbourne, Australia in mid 2009, and in Sydney and the Gold Coast in late 2009. Membership will be A$50 on an annual basis.  ~~~~~~~~~~~~~~~~~~~Wikipedia

funny none of you have any trouble with the higher ceo pay at costco target and your favorite stores,but bitch about lee scotts?explain that please.if costco is so great then how come a union could not get full time work for all?why is it they could only get a 25 hr gurantee?theses same unions deride wm over pay and benefits yet wont stick up for living wages and full time work for all.goes to prove to you wm haters that putting union like ufcw and etc at wm wont gurantee what you all think

Sol Price had FedMart here in San Diego as his forerunner to Price Club. I remember going into FedMart as a youngster in the 1960s and it was a great beginning of the warehouse model. He sold FedMart off to a German interest. Sam Walton came to San Diego and took from Sol Price the Price Club model and a year later (1983?) open a Sam’s Club in Oklahoma City. Walton cites his visit with Sol Price and states he learned more from him than anybody else about retailing in that mode. Jim Sinegal, the current CEO of Costco started out in retail at FedMart.

Who am I to say what somewhat else should make?

You’re absolutely right, Tim, you are nobody and no one should listen to anything you have to say about anything, but how about Sam Walton? Should we listen to him about what Wal-Mart execs should make?

“Recently, I don’t think there’s any doubt that a lot of American management has bent over too far toward taking care of itself first, and worrying about everybody else later.
The Japanese are right on this point: You can’t create a team spirit when the situation is so one-sided, when management gets so much and workers get so little of the pie. Some of these salaries I see out there are completely out of line, and everybody knows it. It’s obvious that most companies would be much better served by basing managers’ pay on the performance of the company or return on investment to the shareholders or some yardstick which clearly takes into account how well they’re doing their job. ~ Sam Walton: Made in America, Bantam edition, June 1993, page 323.

Ken V,

“but how about Sam Walton? Should we listen to him about what Wal-Mart execs should make?”

Wasn’t Sam Walton a Wal-Mart executive?  How do you think he became the richest man in America, by getting a low salary?  Basically, he just didn’t believe in flaunting wealth!!

I guess, just like Bill Gates and Warren Buffett, when you are a billionaire, you can crititize that others are making too much!!

...by getting a low salary?

Even you can’t be so ignorant that you think Sam Walton became the richest man in the world on his salary?

It is a beautiful example of your ‘work-for-the-Man’ mindset though.

Said one insider, who asked not to be identified by name:

“Wal-Mart claims that these ($7.95 jeans) are not loss leaders. Well, if that’s true, imagine the costs of the denim, the zippers, the buttons, the shipping costs, the store overhead, and there certainly isn’t much room left over to pay for the costs of labor. I love free trade, but this makes even me uncomfortable.”

Ken V,

“Even you can’t be so ignorant that you think Sam Walton became the richest man in the world on his salary?”

That was my point, just what exactly IS a salary?  Doesn’t Lee Scott get stock options that can fluxuate with the market, on top of a base salary?  And, if the stock price and dividends go down, doesn’t that diminish his so-called salary?  Sam got rich, by having a huge amount of stock in a company that was growing rapidly and his heirs are now doing the same thing!!  As for Lee Scott, it is in his best interest to raise the stock price and dividend and, if he does the ‘right things’ he will make out well, but if he does ‘things wrong’, he will lose a bundle!!

OK, RDS, calm down. I think you’ve proven that “even you can’t be so ignorant”.

Like I’ve always said, everything has limits.

...doesn’t that diminish his so-called salary?

No, it diminishes his total compensation.

You’re one of those clowns that doesn’t think executive compensation should be linked to performance? Go figure?

What’s good for Wal-Mart is BAD for America!

Ken V,

“No, it diminishes his total compensation.

You’re one of those clowns that doesn’t think executive compensation should be linked to performance? Go figure?”

If a lower stock price “diminishes his total compensation” and quite a bit of his compensation is in stock options, wouldn’t a diminished compensation be a link to performance?  If performance is good, stock goes up, compensation goes up, but if performance is bad, stock price goes down, compensation is diminished!!

RDS, since you want to look at performance through the tunnel vision of stock price alone...it should follow that Lee Scott is not worth what he is paid and the stockholders should have dumped him years ago.

WalMart stockholders have LOST money over the past 5 years in holding onto WalMart stock. Recent gains or loses still do not diminish Costco stock as having been the far better value long term and now a great bargain with Costco’s future growth and tremendous history. The 5 year growth line for Costco stock puts the erratic limited range WalMart stock behavior to shame again in addition to all the money investors have LOST in WalMart’s stock over the past 5 years just from inflation.

“WALMART STOCKHOLDERS HAVE LOST MONEY OVER THE PAST 5 YEARS IN HOLDING ONTO WALMART STOCK”

WalMart (WMT) shares bought Aug. 1st 2003 at the best low 5 year price of $55.27

Dividends paid-

.18 (2003), .52 (2004), .60 (2005), .69? (2006), .88 (2007), .48(.96 projection) (2008)

Total dividends paid per share for cited 5 year time period $3.35

Best 52 week high to date in 2008 $59.95

Total price gain per share in cited 5 year time period $4.68 + $3.35 (Div) = $8.03

no splits for the cover time period

Based on the 5 year time period cited and the $7.34 gain per share in stock value for WalMart shares you would have lost money due to compounded inflation even at the official Bush government low ball inflation rate declarations for 2003 -2008 (2003 - 2.27%, 2004 - 2.68%, 2005 - 3.39%, 2006 - 3.24%, 2007 - 2.85%, 2008 - 4-5%)

55.27 inflation loss = 1.25 (2.27% full year rate)

56.52 inflation loss = 1.51

58.03 inflation loss = 1.96

59.99 inflation loss = 1.94

61.93 inflation loss = 1.76

63.69 inflation loss = 2.86 (4.5% full year rate)

By the end of 2008 your WalMart shares would need to be priced at $66.55 just to stay even with official inflation figures over the past 5 years of holding WalMart stock. So far, even with the dividend per share from WaMart stock, you have lost money ( -17.27% after inflation and at$57/share [7/28/2008] not including the 5 years of total $3.35 dividend)

“He that loveth silver shall not be satisfied with silver; nor he that loveth abundance with increase: this is also vanity.”
Ecclesiastes 5:10 (KJV)

SDV: It is interesting to me that Costco has stores in countries that rejected WalMart’s price-only philosophy. The Japan WalMart’s have been far less successful than anticipated,financially and culturally. WalMart got its head handed to it in Korea,yet Costco------8 in Japan,
6 in South Korea,
5 in Taiwan ,seems to be faring well, as a better “fit” to the cultural values of those countries.From my recollection, the stumbling block with WalMart in those countries was WalMart’s lack of refinemnt and the local interpretation of lowest prices equalling low self-esteem.It appears there are no Costcos in China!

If performance is good, stock goes up, compensation goes up, but if performance is bad, stock price goes down, compensation is diminished!!

RDS doesn’t understand the game. What you say would be right if option price stayed the same....but it doesn’t.

If you have a ‘option’ to buy 10 shares at $20 and the stock is selling for $40, your ‘compensation’ is $200. If, on the other hand, your option is to buy 20 shares at $15 and the stock is selling at $30 (due to your own poor performance) your ‘compensation’ is $300.

Neat, huh?

Ken V,

But, what would it be if you kept the values the same, except selling price?  It’s easy to make it look bad, if you change the values in your example!!  But, that’s what you do well, isn’t it?

10 shares at $20 and the stock is selling at $40, your compensation is $200 ($400-$200=$200).  But, 10 shares at $20 and the stock is selling a $30 (due to your own poor performance), your compensation is $100 ($300-$200=$100).

That’s the point, RDS! The ‘option’ price doesn’t stay the same. Linking compensation to the stock’s selling price is only effective if the ‘option’ price remains the same.

Will someone please slap my face? Why do I waste my time trying to explain business/numbers to Mr. Nine-to-Five?

There is scarcely anything in the world that some man cannot make a little worse, and sell a little more cheaply. The person who buys on price alone is this man’s lawful prey. ~ John Ruskin