Friday, March 26, 2004
Costco Criticized For Taking Care Of Its Employees
We're officially through the looking glass here. Costco takes better care of its employees than Wal-Mart and gets pasted for it:
...Costco's kind-hearted philosophy toward its 100,000 cashiers, shelf-stockers and other workers is drawing criticism from Wall Street. Some analysts and investors contend that the Issaquah, Wash., warehouse-club operator actually is too good to employees, with Costco shareholders suffering as a result.
"From the perspective of investors, Costco's benefits are overly generous," says Bill Dreher, retailing analyst with Deutsche Bank Securities Inc. "Public companies need to care for shareholders first. Costco runs its business like it is a private company."
I guess this is the price for doing your business the right way and doing right by your employees. Luckily, Costco's CEO is sticking to his guns:
"The last thing I want people to believe is that I don't care about the shareholder," says Jim Sinegal, Costco's president and chief executive since 1993, who owns about 3.2 million Costco shares valued at $118 million based on yesterday's price of $36.96, up 52 cents, in 4 p.m. Nasdaq Stock Market trading. "But I happen to believe that in order to reward the shareholder in the long term, you have to please your customers and workers."
Sounds kind of refreshing doesn't it?
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