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How Costco leaves a global imprint

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In the global retailing community, one U.S. retailer has exerted a stronger impact than any other. That impact has not been determined by size or reach or number of stores or by any of the traditional barometers by which retailing impact or influence is measured. Rather, it is reckoned by knowledge of the retail community, how it works and how the various pieces fit together.

Reckoned in those terms, the U.S. retailer whose impact has been greatest is Costco.

Costco has been an American retailing institution for more than a quarter of a century. Its warehouses blanket the country. U.S. consumers welcome them as an integral part of their shopping routine. They embrace their local Costco, not as a place for fill-in shopping but as a necessity, an inexpensive and pleasurable experience, a way to restock the kitchen cabinet and refrigerator that is anticipated rather than dreaded.

The Costco concept, one based on membership, is easily mastered and eagerly employed. It gives the shopper a sense, half real and half imagined, that bargains are to be found in every department, down every aisle, in every corner of the warehouse. And in the main, they are right.

Costco’s managers and staffers have successfully imported this concept to every corner of the world. It exists today, successfully, wherever consumers shop in search of a fair deal. The retailer’s executives have tailored the Costco concept to fit local shopping mores and local competition wherever the retailer has chosen to go, always studying the market first, always analyzing local shopping conditions, always willing to work with local competition where that arrangement is warranted — and effective.

And, oh yes, there is one other ingredient that makes this formula work so effectively: leadership. Costco was conceived and founded those few short years ago by Jim Sinegal, one of the few true innovators mass retailing has produced. He led the retailer with an iron fist in a velvet glove, insisting on his way of doing things only when he knew he was right. Which was almost always.

When Sinegal retired, he passed the leadership role to another individual, one equally adept at making a retail concept work, one (almost) as brilliant as his predecessor. That man runs the company today. His name is Craig Jelinek.

And, oh yes, one more thing. Costco boasts the most stable, effective and consistent staff in all of mass retailing. Costco staffers don’t leave. Occasionally they retire. Once in a while they pass on. But they always improve, always get better, always find new ways of improving on a concept that was nearly perfect to begin with.

So that’s the story. Simple, isn’t it? If you know how.


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