hottest club in america

hey there teddy bears,

today we’re talking about the home of:

• ¼ pound hot dog + soda combo for $1.50 that’s been inflation proof since 1985 & has a cult following with t-shirts & memes to prove it

• 3 pound rotisserie chickens for $4.99 that routinely sell out & sometimes cause fights

• 1 oz 24-karat gold bars for +$2K that launched in 2023 & are already a +$100M a month business

• kirkland signature, the biggest consumer package goods brand in america, that generated $56B in annual revenue, more than macy’s & mcdonald’s combined

• bargains you buy that you don’t need like f1 tickets, jugs of capri sun, apocalypse food buckets, whole wheel parmesan, & ghillie suits.

this wholesale club operates +880 warehouses in 14 countries with +300,000 employees serving +75 million paid members worldwide with a renewal rate of 93%.

one thing’s clear: costco knows how to run a business.

while most are focused on costco’s value play, samples, return policy, or recent membership price increase, i’m much more impressed by their real secret sauce: their people.

this is part 3 of 4 in our deep dive into each leg of my profiTABLE framework.

before we go down the aisles... please show your support for merry makery by clicking the link below to learn about our merry partner, mood gummies!

These cannabis gummies keep selling out in 2023

• Mood is an online dispensary that has invented a “joint within a gummy” that’s extremely potent yet federally-legal.

• Just 1 of their rapid onset THC gummies can get you feeling right within 5 minutes!

Order Now

clubbing together

the costco we know & love today emerged from a merger in 1993 of two mega-discount retailers— price club & costco. both brands believers in the philosophy of doing the right thing, which is still a core value today.

since day 1, this meant delivering value to customers AND creating a workplace where employees felt valued too.

the cofounders famously rejected the idea that keeping labor costs low was the key to retail success. instead, they focused on building a workforce that was engaged, loyal, & motivated to deliver excellent customer service

👆️ that’s exactly what costco has done at insane scale.

in an industry where high turnover is the norm think 90-100%,
costco’s retention rates remain very very very low
in the single digits around 8% !!!

forklift to ceo

fast forward to today, costco is still walking the talk when it comes to putting people first. the company’s commitment to its employees is reflected in everything from wages & benefits to opportunities for growth.

costco employees are among the best compensated in retail.

consistently ahead of the curve with wage increases, costco raised its minimum starting wage to $19.50/hr—far above the fed min wage of $7.25.

they sweeten the deal even more for both full & part-time workers with comprehensive health benefits, a 401(k) plan, generous overtime, & 1.5x pay on sundays.

but what i find most admirable is their commitment to internal promotions.

take costco’s current ceo, ron vachris, who started as a forklift driver in 1982 & worked his way up over four decades. vachris’ story is just one of many.

87% of costco’s warehouse managers started as hourly staff.

this culture of growth & development is a big reason why costco continues to thrive in a cutthroat retail environment.

loyalty pays in so many ways.

all these touches that make costco feel like a community rather than just a place to shop. after all, only happy people draw smiley faces on receipts.

people powered profits

in a retail landscape that’s increasingly driven by technology & automation, the masses are focusing more on efficiency and less on people.

i predict that costco will double down on this people-first approach.

maybe costco will lead the charge in new employee benefits, innovative training programs (costo college anyone?), or more flex work arrangements?

i’m not entirely sure what it will look like, but i am confident that with the current ceo ron will triple down on promoting from within. imo a smart way of ensuring that the future leaders are deeply rooted in its people-first philosophy.

let’s be clear about one thing, this isn’t just altruism.

it’s good for their business.

they make more money on you paying to shop at costco
than from you actually shopping at costo.

70% of their operating profit is from membership fee revenue.

happy employees = happy members = happy profit.

so next time you’re cruising those costco aisles, remember it’s the people behind the pallets who make it all possible. & as long as costco keeps taking care of its employees, you can bet they’ll keep taking care of us.

to that let’s raise a glass of kirkland’s signature scotch to costco’s people & the power of putting people first 🫶 

p.s. finally got around to adding a scheduling link which you can find at the bottom of every email. if you ever want to chat costco_, retail, or life, click the link “schedule a call” link at the fooder of this newsie.