Costco Resisted Wall Street Pressure To Cut Wages, Benefits: Report
Costco Resisted Wall Street Pressure To Cut Wages, Benefits: Reporthttp://www.huffingtonpost.com/2013/06/06/richard-galanti-wages_n_3396101.html?ncid=edlinkusaolp00000003
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The big box store most famous for its stockpiles of toilet paper and $1.50 hot dogs also has a reputation for paying its workers a higher wage than most of its competitors. The average Costco worker made about $45,000 per year, Fortune reports. By comparison, Walmart-owned Sam’s Club, a Costco competitor, pays its workers $17,486 per year, according to salary information site Glassdoor.com.
What’s more, Costco has continued to pay its workers decently even in the face of pressure to stop. Ever since the company went public in 1985, Wall Street investors have urged Costco executives to lower wages and cut health benefits, which are also relatively generous, according to Businessweek. Instead, the company’s former CEO and co-founder gave workers a raise every three years.
Costco’s insistence on treating its workers well hasn’t come at the expense of the company’s bottom line. The retailer’s profit jumped 19 percent to $459 million last quarter, while Walmart’s sales suffered during the same period.
In addition, Target, another Costco competitor, slashed its earnings forecast for the year after its profits suffered because customers cut back. (Costco reported Thursday that last month's same-store sales grew 5 percent, but did miss analyst expectations.)
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= new reply since forum marked as read
also love what my COST stock is doing as well.
IN the rancorous debate over how to get the sluggish economy moving, we have forgotten the wisdom of Henry Ford. In 1914, not long after the Ford Motor Company came out with the Model T, Ford made the startling announcement that he would pay his workers the unheard-of wage of $5 a day.
Not only was it a matter of social justice, Ford wrote, but paying high wages was also smart business. When wages are low, uncertainty dogs the marketplace and growth is weak. But when pay is high and steady, Ford asserted, business is more secure because workers earn enough to become good customers. They can afford to buy Model Ts.
This is not to suggest that Ford single-handedly created the American middle class. But he was one of the first business leaders to articulate what economists call “the virtuous circle of growth”: well-paid workers generating consumer demand that in turn promotes business expansion and hiring. Other executives bought his logic, and just as important, strong unions fought for rising pay and good benefits in contracts like the 1950 “Treaty of Detroit” between General Motors and the United Auto Workers.
Riding the dynamics of the virtuous circle, America enjoyed its best period of sustained growth in the decades after World War II, from 1945 to 1973, even though income tax rates were far higher than today. It created not only unprecedented middle-class prosperity but also far greater economic equality than today.
http://www.nytimes.com/2012/09/03/opinion/henry-ford-when-capitalists-cared.html?_r=0
Henery Ford was the ultimate capitalist, todays CEO's and share holders need to follow the COSTCO buisness model, which is the Henry Ford model.!!!!
History repeats itself, lets hope the COSTCO model becomes the mantra for our times.
Testifying at Nuremberg, convicted Hitler Youth leader Baldur von Schirach who, in his role as military governor of Vienna deported 65,000 Jews to camps in Poland, stated,
The decisive anti-Semitic book I was reading and the book that influenced my comrades was [...] that book by Henry Ford, "The International Jew." I read it and became anti-Semitic. The book made a great influence on myself and my friends because we saw in Henry Ford the representative of success and also the representative of a progressive social policy.[74][75]
http://en.wikipedia.org/wiki/Henry_Ford
My point being that as much of a rat bastard H. Ford was, he still had somewhat of a right idea about running a business. Costco has taken the idea and made it right.
I purposely used Henry Ford as an example because even the biggest tea-party douchbag can identify with one of their own like minded heroes. Therefore maybe they will be reminded that even Henry Ford did not try to drag this country down to what it has become today.
