Wall Street upset:

[Piglet 0]

http://www.nytimes.com/2005/07/17/business...serland&emc=rss

But not everyone is happy with Costco's business strategy. Some Wall Street analysts assert that Mr. Sinegal is overly generous not only to Costco's customers but to its workers as well.

Costco's average pay, for example, is $17 an hour, 42 percent higher than its fiercest rival, Sam's Club. And Costco's health plan makes those at many other retailers look Scroogish. One analyst, Bill Dreher of Deutsche Bank, complained last year that at Costco "it's better to be an employee or a customer than a shareholder."

Mr. Sinegal begs to differ. He rejects Wall Street's assumption that to succeed in discount retailing, companies must pay poorly and skimp on benefits, or must ratchet up prices to meet Wall Street's profit demands.

Good wages and benefits are why Costco has extremely low rates of turnover and theft by employees, he said. And Costco's customers, who are more affluent than other warehouse store shoppers, stay loyal because they like that low prices do not come at the workers' expense. "This is not altruistic," he said. "This is good business."

That's right, fat cat CEOS like Eisner can drain the company of million dollar "compensation" packages while losing their companies money hand over fist. But God forbid that honest hard working American workers should actually get paid what they're worth. Get with it, CostCo! Don't you know the Republicans are in charge? You're supposed to be abusing the workforce, shipping their jobs overseas, replacing them with illegal help who will work for subminimum wage under the table.

Wall Street ain't our friend.

[TrueBlue72 0]

I agree wholeheartedly with Costco's strategy as long as they don't become complacent and let their customers down. I've been a Sam's club business member for almost 20 years and have watched their decline since the death of Sam Walton. Since I found the Costco in B'ham, I rarely visit a Sam's.

Good wages and benefits allow a company to hire and keep better employees. Those better employees, if managed properly, are more productive and provide a higer level of customer satisfaction.

Wall Street and their "what have you done for me lately" attitude isn't necessarily good for a company when they start using statistics to measure a company's worth.

What I don't understand is how anyone can look at that article and find anything that is remotely political in it or furthers your anti-republican agenda.

[DKW 86 7,450]

Ditto here too. Costco actually has employees that give a care.

Want to see an American Tragedy? Try and buy something from Sears, go ahead, I dare you. You cannot find anyone that will bill you out, and no one knows anything about what they are selling.

[TexasTiger 13,053]

Ditto here too. Costco actually has employees that give a care.

Want to see an American Tragedy? Try and buy something from Sears, go ahead, I dare you. You cannot find anyone that will bill you out, and no one knows anything about what they are selling.

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Walmart is the worst, although not as bad in some smaller towns where they may get some of the better folks available in the workforce.

[Tigermike 3,065]

One analyst, Bill Dreher of Deutsche Bank, complained last year that at Costco "it's better to be an employee or a customer than a shareholder."

I would say that Mr. Dreher is a bag and is working for the right bank.

Shareholders should get a return on their investment, that return should never rape the employees. Many shareholders and investment bankers have forgotten that the people who buy their goods and services are employees somewhere and if they don't have a disposal income, there will be less and less sold and therefore less profit for the stockholders.

[TitanTiger 20,530]

Everyone should read that entire article, it's worth the time and shows that you don't have to be a slave to a quarterly report and make your employees shoulder all the brunt of competing aggressively on price. On top of that, the CEO takes a salary of $350,000 a year and got a $200,000 bonus. That's insanely low compared to other CEOs. He does have about $150 million in stock options, but he did start the company. Most CEOs make several million dollars with the stock options to boot.