[CEO Profile Report]

By

[Nirjhar Garg] [MBA: 592-SEC01] [Prof. Michael Nugent]

TABLE OF CONTENTS
BACKGROUND LEADERSHIP STYLE PHILOSOPHY LEADERSHIP VALUES STRENGTHS & WEAKNESS QUALITIES LEARNINGS REFERENCES 2 5 7 11 13 15 17 18

BACKGROUND
The average customer visits their local Costco 22 times a year. The company has become one of the largest in the U.S., with 473 outlets and more than $50 billion in sales, and is also the largest membership warehouse club chain in the world. Its founder and CEO, Jim Sinegal, has been called the Sam Walton of the 21st century for his low-key style and seeming defiance of all things Wall Street. But, whether investors like him or not, America and much of the rest of the world has fallen in love with his discount depots. The son of a steelworker, Sinegal has come a long way to get to where he is today. Born on January 1, 1936 in Pittsburgh, Pennsylvania, James D. Sinegal was raised in a typical working-class Catholic family. As a boy, the young Sinegal dreamed of going to medical school. He graduated from Helix High School in 1953 and decided he would try to make his dream a reality by applying for enrollment in San Diego State University. However, that dream was short-lived. When Jim Sinegal was a student at what was then known as San Diego Junior College, he and other young students looked to the just-returned Korean War veterans for inspiration. "These were people who had seen so much, who had been matured by the war," Jim says [1]. "We learned a lot by how they carried themselves." After graduating from Helix High School in 1953, Jim attempted to attend San Diego State University, but was advised he might be better served attending a two-year program first. My test scores were good, but my grades weren't that good, because I needed focus, recalls Sinegal, who was advised to first apply for a short program at San Diego College. There, he not only earned an associates degree, but he also got back his motivation and concentration. It was at San Diego Junior College (now City College) where I regained that focus,
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and paid attention, says Sinegal, because deep down I knew education was important. After transferring to SDSU, Jim gained business education knowledge, began working for Fed-Mart, and eventually met Price Club founder Sol Price. He would go on to help found one of the great wholesale companies in industry history, a story that continues to this day. That's one of the reasons he was recently chosen as a Most Distinguished Alumnus by City College. Today, students can learn a lot from Jim, who has traveled from unfocused student to president and CEO of Costco Wholesale Corp. He has served as president and CEO of PriceCostco Inc., and was a founder of Costco Wholesale Corp. in 1983. Jim was also a vice president of merchandising for Builders Emporium, and began his retail career in San Diego with the Fed-Mart organization. He now recalls his San Diego Junior College days fondly. "It was a fantastic time for me," says Jim, who still visits frequently. "The college continues to play a big role in the city, and is an asset to the community [2]. When Sinegals college presented him with its Most Distinguished Alumnus award, the Costco founder was almost left speechless. Ive never been told Im a most distinguished anything, was all he could say [3]. With his poor grades and lack of focus in high school, it is doubtful that Sinegals teachers ever thought he would amount to much. But, today, with a billion dollar corporation under his belt, Sinegal remains not only one of the most accomplished, but also one of the most admired and liked CEOs in the industry. How did this once reckless young boy become the success he is today? After earning his degree, Sinegal finally enrolled in San Diego State University. To help support himself through school, he applied for a job at Sol Prices newly expanding Fed-Mart. The 18-year old Sinegal was given the task of unpacking mattresses as they arrived. It wasnt that great a job, he says. I was getting a buck and a quarter an hour. But it was exciting. It was at Fed-Mart that Sinegal discovered his passion for retail. Within just a few years, he had been promoted to store manager. He soon quit his university studies and devoted himself full-time to Fed-Mart. Eventually; Sinegal would rise to become the executive vice president of the chain. In 1979, Price decided to abandon Fed-Mart and start a new venture, and he wanted to take Sinegal with him. Over the years, Sinegal had proven himself a loyal and hard worker, and Price did not want to lose him. Sinegal agreed, and

together, the two created Price Club. Initially, Price Club was meant to service small business owners, but eventually its membership became open to the public. Sinegal was executive vice president, and was the major driving forces behind helping his former Fed-Mart boss establish the new company [3]. By 1981, Sinegal realized he had been working with Price for almost 30 years. It was time for him to move on. Both Fed-Mart and Price Club had been a success, but Sinegal wanted to do something for himself. That year, he decided to leave Price, to give up his secure job, and to risk it on all on his own.

LEADERSHIP

STYLE

Jims leadership style has always revolved around respect and self-belief. He has always believed that, being a Costco employee is nothing to shrug your shoulders at. With one of the highest pay rates in the industry, and an overly generous health package, Sinegal has established a one-of-a-kind human resource management plan. In doing so, he also lowered his rates of turnover and theft, and created a thousand-strong army of motivated and productive employees. Sinegal is a living representation of what made this country great. A person who cares about people more than profits, and realizes the long term socioeconomic and monetary benefits of treating employees and customers alike. Most business owners nowadays are Rockefeller throwbacks, acting like royalty and betraying American principles for the sake of profit, which could perhaps learn a few lessons from a man like this. Ethical and noble in his cause, more character than most [11]. Costcos chief executive, Jim Sinegal, announced he would step down from his job at the warehouse club January 1, 2013. On this day, corporate America will lose a leader of a very different sort. Sinegal founded Costco with Jeff Brotman, its chairman, in 1983 and expanded it in the 1990s when his company combined with Price Club, owned by Sol Price. From those beginnings, Sinegal created a warehouse behemoth that pulled in $76 billion in revenue in 2010. Despite the economy, customers kept paying the $50 to $100 annual fees: 87 percent renewed their memberships in 2010. He laid no one off in the recession, other than short-term staff for holidays. And yet, Sinegal, who no doubt has become wealthy through Costco, makes about a third the pay of an average CEO. His salary is $350,000 a year. And his total take-home pay amounted to $3.5 million in 2010 a nice sum, to be sure, but again, less than the median $9.3 million [12]. Its not just his pay that lacks showiness. His office was a tiny alcove without a door; the furnishings were as fancy as folding chairs. Whenever a reporter visited

the headquarters, which did not have any public relations handlers on staff, Sinegal usually came out to the reception desk himself. He also answered his own phone (Sinegal!) at office. He could probably have charged more for the goods in his store. But Sinegal held fast to a mantra that nothing in the warehouse should be marked up more than 14 to 15 percent from cost. His discipline was legendary. People have always asked historically, whos the toughest competitor? the companys chief financial officer, Richard Galanti, told to a reporter back in 2008 [12], its Jim. That discipline to pricing hasnt won many praises from Wall Street analysts. Neither has Costcos wage and benefit policies. In 2003, Costco, which hadnt raised its health-care premiums to employees for nine years, said it was going to miss its earnings estimate due to rising costs. Sinegal was adamantly against raising premiums. Finally, he relented. He wrote a letter to employees promising they wouldnt pay more than 10 percent of the overall cost. Fast forward a few years and employees were paying a little more than the 10 percent. Most CEOs, of course, would have welcomed the cost savings, pocketing the difference. But Sinegal gave each employee an added bit of stock in their 401(k)s in 2008. Sinegal has instilled these sensibilities in his executives, most of who have worked with him for decades. That includes President and Chief Operating Officer Craig Jelinek, who has been named as his successor come January 2013. Sinegal provides an unusual picture of what true leadership looks like.

PHILOSOPHY
In an interview published in the Houston Chronicle on July 17, 2005, Senegal told Steven Greenhouse that he did not care about Wall Street analysts who had criticized him for putting good treatment of employees and customers ahead of pleasing shareholders. Investors might want higher earnings, but Sinegal stated, We want to build a company that will still be here 50 and 60 years from now." A favorite quote attributed to Sinegal, in part about his philosophy on dealing with success, is, you have to take the shit with the sugar [21]. Investors who bought $10,000 of Costco stock in 1992 found it worth $43,564 just ten years later (a return of 354% [15.855%, annually]). A 2012 CNBC documentary stated that from 1985 until Sinegal's retirement, the stock's value had increased by five thousand percent. Costco's two highest-sales years to date were Sinegal's final two years as CEO. In 2009, Mr. Sinegal was considered one of "The TopGun CEOs" by Brendan Wood International, an advisory agency [22]. One of the most colorful personalities in retailing, Sinegal is known for his integrity, his unwillingness to squeeze customers or employees to please Wall Street, and his abiding love of $1.50 hot dog and soda deal, something that he promises will never change so long as he is in charge [23]. While not all of its product prices are guaranteed to remain the same for so long, Sinegal has made it his priority to give his customers the greatest value for their money. By keeping a low stock of high quality products, and refusing to hike his profit margins by more than 14 percent, Sinegal has stayed true to his goal. Costco, the well-known discount-warehouse store, was started in 1983. By 2004 Costco had become the 5th largest retailer in the U.S. and the 11th largest in the world. Sales by store and online have continued to grow, with Costco.com reaching $1 billion in annual revenue and each location averaging $130 million in sales every year by 2007. It is also recognized for its loyal customers and happy employees. All of this in spite of Costcos unusual approach of requiring customers to pay for the privilege of buying things.

As one of the smartest and most successful retail shops besides, maybe, WalMart, what has Costco done to build this success? To start, heres what cofounder Jim Sinegal says about his operation: "Costco is able to offer lower prices and better values by eliminating virtually all the frills and costs historically associated with conventional wholesalers and retailers, including salespeople, fancy buildings, delivery, and billing and accounts receivable. We run a tight operation with extremely low overhead which enables us to pass on dramatic savings to our members." But this quote is just the tip of the iceberg [23]. Here are fifteen other keys to Costcos success that make up for Jim Senegals Philosophy and towards his success [23] [3] 1. Put the customer first. This seems obvious, but consider Costcos $1.50 hot dog. After 15 years, its price hasnt budged. To keep costs and prices low, Costco execs built their own meat plant and bakery. Essentially, Costco completely changed the way it did business for just one product. And thats in spite of the reality that most customers wouldnt notice slow price increases. The decision was about doing the right thing for customers, not impressing them or even keeping them loyal. Thats a customer focus that goes all the way to the bone. 2. Eliminate the frills. Costco warehouses have concrete floors and the same boxes that products arrived in are used to hold customer purchases. Shelving is simple and steel and you often have to pull your own goods out of the original shipping containers. But when you can get top-notch produce and meat at prices noticeably less expensive than standard grocery stores, its not about the ambience. 3. Bring your truck. You can pick up a bathroom vanity that would cost several thousand dollars in another store for $700 to $800, but youd better plan on bringing your own truck to get it home. In recognition of the challenge of offering larger items, Costco lets customers use flat-bed carts for easier loading and unloading and thats it. Costcos business centers and Costco.com do, however, offer delivery for high-dollar purchases. 4. Offering the best. When youre saving serious money on Dom Perignon champagne or lobster tails and bacon-wrapped scallops, it stops being about finding bargains. By choosing to offer luxury goods at warehouse

prices, Costco has gained a cachet even among those who regularly shop retail. 5. Private labeling. The Kirkland brand, Costcos generic product label, is one of their smartest decisions. Its because Kirkland products are often better than the recognized brands, but cost significantly less. Large volumes allow Costco to source and offer exceptional deals with Kirkland products. 6. Rewarding employees. Costco provides exceptional benefits including medical with subsidies for spouse and dependent coverage, dental, vision and a 401(k) plan. Other pluses such as short and long-term disability and life insurance are part of the package. They even offer long-term care insurance for employees with more than 10 years with the company. Costco is also committed to promoting from within. Most of Costcos managers started in a warehouse. 7. Valuing suppliers. Unlike other retailers, Costco works closely with its suppliers to help them discover ways to run their businesses better. The company is committed to supplier diversity and makes extensive use of regional sources for fresh meat and produce. The magazine sent to Executive Members, Costco Connection, has numerous articles that recognize suppliers for their ethical and smart approaches to their business and their products. 8. Sticking to the fundamentals. Costcos philosophy and values havent changed since its start, despite the companys incredible growth over the last few decades. 9. Technology. It may not be one of the industrys most hi-tech companies, but Sinegal made sure that where it needs to be, and so, Costco is at the forefront of technology. By embracing new forms of automation, and being willing to experiment with energy-reducing technologies, Costco has emerged as a technologically savvy retail leader. 10. Communication. This is almost like show business, says Sinegal. I mean, every day you're opening up and its show time. Sinegal loves his job, and that is why no matter whether you are a cashier or a fellow CEO, he is

willing to take the time to talk to you. A down-to-earth businessman, Sinegal makes sure that all the processes are in place to maintain a corporate system of accountability and openness. 11. Marketing. Is it odd that despite not ever spending a dollar on advertising, marketing is considered one of Sinegals success factors? Well, despite the lack of money spent on it, Sinegal knew what he was doing in terms of promotion. By creating a happy and loyal team of workers, and focusing on growing strong relationships with small businesses, Sinegal did, in fact, create a marketing machine in Costco. 12. Strategy. Were not kamikaze pilots, says Sinegal. We want to do things in a sensible fashion. To that end, Sinegal has taken the time to plan out his growth strategy. From the light bulbs in his stores to the population densities of the next cities Costco plans to move into, Sinegal leaves no stone unturned. And, it is those details that Sinegal says every entrepreneur needs to focus on. Otherwise youre just a hamster running on a treadmill. 13. Planning. Sinegal believes that strategic planning is an important part of running any business and the more so for businesses that operate in multiple states and countries. He feels that competition makes you stronger. If the top competitor didnt exist, then, he would have to make them up. 14. Value. Enough emphasis was laid down by Sinegal on core values. He believes that value is appreciated no matter where you go. Sinegal says, If you don't have the right merchandise in the right place at the right time you can forget about everything else. All the satellites in the world aren't going to help you. We only have one bullet in our gun, the right product at the right price. 15. Attitude. Jim Sinegals attitude has always been that if you hire good people and provide good wages and good jobs and more than that if you provide careers that good things will happen to your company. I dont see whats wrong with an employee earning enough to be able to buy a house or have a health plan for the family. Says Jim.

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LEADERSHIP

VALUES

Sinegal was Costco's President and CEO. He remains on Costco's Board of Directors. As CEO, Sinegal was well known for traveling to each location every year, to inspect them personallya task that virtually all major retail chain leaders delegate to subordinates. Sinegal's innovations made Costco the first "warehouse club" to include fresh food, eye-care clinics, pharmacies, and gas stations in its mix of goods and services [31]. Sinegal steps down after seeing Costco through a recession in which other retailers slashed jobs, eliminated stores and went out of business. Under Sinegal, Costco laid off no one, aside from its usual seasonal workers and extra people hired for new-store openings. It also refused to cut back on health benefits, despite rising costs and pressure from Wall Street and Sinegal has steadfastly resisted marking up the company's prices on branded items any more than 14 percent. Costco's sales and profits have been constantly rising, and its stock is near an all-time high. It slowed the pace of new-store openings, largely because it had trouble finding sites as shopping-center developers and banks went out of business. Consumers kept paying their membership fees of $50 or $100 during the economic crisis because of the value Costco offers. Sinegal was a protg of the legendary Sol Price, widely considered to be the 'father' of the "warehouse store" concept (i.e., selling high volumes of a small variety of goods, at supposedly 'wholesale'-level-low prices, to a select group of customerswho pay a membership fee in exchange for the right to shop there). Sinegal is known for a benevolent style of management rooted in the belief that employees who are treated well, will in turn, treat/serve customers well. Sinegal, through Costco, provided his employeesat every level of the company, including the storescompensation and benefits that are much higher than retail industry norms. For example, over 90% of Costco employees qualify for employer-sponsored health insurance; the U.S. retail industry average

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is just under sixty percent. As a result, Costco has the lowest employee turnover rate in retail. Undoubtedly, Sinegal has done an amazing job of keeping the company focused on their core values to create one of the strongest consumer franchises in the world. Eighty-nine percent of its members renew every year, and the rate for business members is higher: above ninety percent [32]. Costco does not press suppliers for impossibly low prices, but Sinegal insists on integrity and honesty. A classic example of this was when the chain famously pulled Coca-Cola from its shelves in 2009 after learning that it was not getting the soda manufacturer's lowest price. In a few weeks, the companies reached an agreement and Coke products were back. Different companies, of course, require different skills. What works for a Silicon Valley tech shop may not work for a retailer. Jim Sinegal reflects that. He comes from a diverse background whose styles and strengths vary. What he does share, however, is a passion for his company, that drives him further to study and refine even the smallest details. It compels him to seek people outside the normal CEO orbit, from factory workers to suppliers to customers, to give them the insights they need to run the company better. Armed with an almost molecular understanding of his organization, Sinegal has always been confident taking risks and invariably has planned for the long term. Yes, there have been times when went through tough periods, but he kept constantly thinking ahead to the next change of cycle [33]. Though Sinegal stepped down as CEO, he intends to remain at Costco through January 2013 to advise and assist amid the transition. Sinegal provided an unusual picture of what true leadership looks like.

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STRENGTHS

AND

WEAKNESS

Apple Inc. has been one of the few true growth stories on Wall Street lately, and the death of Steve Jobs at just 56 years old makes you wonder if any good stocks and more importantly, any good leaders remain [41]. While Steve Jobs was a cultural force the likes of which the world might never see again, there still are wise and talented leaders out there right now. These CEOs share the Apple founders ability to create value for shareholders and employees, and to define their industry to both competitors and consumers alike. One such CEO was James D. Sinegal of Costco. Sinegal like Steve Jobs of Apple Inc. is an innovative business builder, a guy with a long-term focus on shareholder value and connecting with consumers in new ways [41]. Lest you think such success depends on an iPhone-like innovation, its worth noting that gadgets were only part of the Steve Jobs story. There was his focus on a long-term vision that trumps the quarterly drumbeat of the Street. There was his shrewd use of capital to grow his company and to cripple competitors. And above all, there was his desire to connect completely with customers so his product would almost sell itself. Whereas, on the other hand, what the heck does a 30gallon tub of mayonnaise at Costco have to do with the iPad? Probably not much. But when it comes to innovative business builders guys with a long-term focus on shareholder value and connecting with consumers in new ways Steve Jobs and James Sinegal were two peas in a pod. Sinegal co-founded Costco and has been president since 1983. It is his innovations that made Costco the first warehouse club to include fresh food, eye-care clinics, pharmacies, gas stations and other businesses previously thought out of place on retail floors. Shares of Costco are up 2,800 percent and have paid modest dividends since 2004, all credits to Sinegal. Something which places both Jobs and Sinegal in same league is Sinegals desire to put user experience above everything else. Being in retailer business, where customer satisfaction is a priority and which in turn cannot be achieved unless the employees are happy, and motivated. About four out of every five Costco workers get health care and benefits, even though about half are part-timers.

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The average wage is $19 an hour, and there have been no layoffs in the recession [42]. In this respect, the Costco founder actually might be one up on Steve Jobs. Many Apple critics malign the companys outsourcing to Asia, while Sinegal managed to create an industry leader that offers livable wages to almost 150,000 Americans all while Costco stock beats the market and is on track to turn a cool $1.4 billion in profits [41]. And there is one more category where Sinegal can be considered a step ahead of Jobs, while Jobs outsourced work to Asia, Sinegal managed to create an industry leader that offers livable wages to almost 150,000 Americans [42]. Another qualifying strength that Jim Sinegal has is the A-Factor the authenticity factor a deep and abiding emotional attachment to the purpose of his enterprise. Once you know how to spot it the A-factor can help you identify companies with a leg up on the competition. For me, Jim Sinegal embodies authenticity. The founder of Costco is an authentic crusader for retail goodness. It takes less than five minutes of talking to him for his passion for retail to come across [43]. Sinegal doesn't spend much time in his office at Costco headquarters. He's too busy visiting stores, talking to employees and customers about the products. He is heralded in his industry as a master merchandiser, and he has the ability to assess how well a retail store is run within one minute of walking through the door [43]. Even when Costco Wholesale co-founder and Chief Executive Officer Jim Sinegal talks about leaving the company he built into the country's third-largest retailer, he exudes his quirky mix of humble, frank and feisty. "It'll be an upgrade," Sinegal joked about being replaced as CEO on Jan. 1 by President and Chief Operating Officer Craig Jelinek. "He is well-liked and smart and energetic and all the things that I used to be." He will turn 76 on Jan. 1 and plans to spend one more year working full time for Costco, helping with the CEO transition at the Issaquah-based company. "I'll advise when I'm asked and try not to interfere and meddle," he says [32]. Sinegal said his age and the fact that Costco is in good shape made January the right time to step down as CEO. "This is a positive move for Costco, and I feel very good about it," he said. "Everybody says that, and it sounds like a lot of bull, but I mean it."

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QUALITIES
One fine midmorning at Costco in Arlington, VA, Shoppers push smart car-size carts, politicos peruse the stack of Ted Kennedy books, and husbands disappear among 32-inch Sony televisions. And Jim Sinegal, a straight-talking, fast-moving 73-year-old, is ping-ponging around customers, employees, and tables loaded down with Michael Kors microfiber jackets, 10-pound bags of organic carrots, and packaged perfume sets. He's a man on a mission, one that might seem odd for the CEO and president of the third-largest U.S. retailer: See the store as customers see it. But then, Sinegal isn't the typical corporate executive part of both his charm and the company's success [51]. In front of a pile of extra-large bags of potatoes, Sinegal stops. "How long have you been $8.49 on this?" he asks the location manager, John Rohr, who is, a little nervously, trailing his boss through the store. Two days, Rohr says. "What were you before, $7.99?" Sinegal asks. No, Rohr tells him, $8.99. "So you went down 50 cents?" Sinegal looks at the potatoes, looks back at Rohr, and nods approvingly. During a recession, it might not seem much of a surprise for a CEO to applaud lowering prices. But since Sinegal cofounded Costco with Jeffrey Brotman in 1983, that's been his shtick even in the best of times: Keep prices so low that other stores can't compete. Items are marked up an average of just 10.5 percent, eking out razor-thin profit margins of less than 3 percent. Still, that was enough especially when combined with Costco's membership feesto turn a $1.3 billion profit in fiscal 2008. Pushing low prices, though, isn't what really sets Sinegal apart. He also has a habit, which sometimes irks stockholders and almost certainly annoys his competitors, of taking excellent care of his employees. Eighty-six percent of them get healthcare and benefits, even though half are part-timers, and the average wage is $19 an hour. And Costco hasn't had any layoffs in the recession. Why such generosity? "It's really pretty simple. It's good business. When you hire good people, and you provide good jobs and good wages and a career, good things are going to happen," Sinegal says. "We try to give a message of quality in everything that we do, and we think that that starts with the people. It doesn't do much good to have a quality image, whether it's with the facility or whether it's with the

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merchandise, if you don't have real quality people taking care of your customers." Commonly known as the much-loved uncle, the attitude has won Sinegal the adoration of his employees. Because he tries to visit the Pentagon City store at least twice a year, part of the storehopping tour he's on about 200 days out of 365, many have met him before. That includes Joseph Barbaro, who has worked for Costco on and off since 1990. But today, Barbaro is still so excited to see Sinegal that he asks him for his autograph and a picture. "I love this work. I love it," Barbaro says. "Costco is the best at everything, including the president and the board of directors." At the bakery, when Sinegal picks up a rose-festooned sheet cake and tells the workers, "It looks good enough to eat! Really, they look beautiful. Thank you," the smiles on the employees' faces radiate less relief than a pride akin to having pleased a much-loved uncle [51]. All of that helps keep Costco's employee turnover rate at 12 percent, remarkably low for retail. Rohr, for example, started as a return-to-vendor associate at 25. Now 48, he never left. "I was planning on a little bridge job," he says. "That's the culture. When you get hired, the first thing the manager tells you is that you can have a career here. If you choose it, you can have it." Sinegal, meanwhile, is clearly pleased that he's made his career hereand not just because of his salary (which, at $350,000, is at the low end for the head of a $70 billion company). "I just love it. I like to come in and listen to the cash registers ring," he says, sitting down in the food court to chat. "It's just fun. That's the reason these guys stay with us." And, he adds, "if you've got to work for the rest of your life, you'd better do something you'll enjoy." When he retires, Sinegal says, is up to the board of directors. Given his record so far, though, it hardly seems imminent.

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LEARNINGS
For me, Sinegal always seemed like one of the good guys -- an outstanding example of how to be a CEO. He played a major role in building Costco into the third-largest retailer in the country, creating a model that rewards workers handsomely even while competitors cut benefits. As part of my learnings from Sinegals experience, here are five CEO traits Sinegal has that I wish more business leaders would acquire [61] 1. Use your products. Sinegal is often clad in one of Costco's $17 dress shirts, long a staple of the company's apparel department. He proudly wears them to company annual meetings, too. 2. Be accessible. One of the things that very few of us know about Sinegal was that his office was in the hallway at Costco's Issaquah headquarters. That's right, not even a door that shut. Not even a glass wall between him and the rest of the staff. Anybody can wander by and chat him up, anytime. He would give his cellphone number directly, where most execs would make you call in through one of those conference bridges or have a secretary patch you through. There were never any layers of handlers around Sinegal. 3. Treat your employees great. Costco is well-known for offering aboveaverage pay for warehouse-store workers. The result is low turnover, low training costs and a family feeling to the company. They don't have to do much recruiting, as current employees are happy to put out the word to family and friends. 4. Stay humble. Despite commanding a $76 billion retail empire, Sinegal is still honest, straightforward and down-to-earth. His desk was a cheap, Formica-topped folding table -- a Costco sale item -- and behind him sat an aged, fabric-covered message board. No burnished hardwood executive desk and fancy whiteboards for him. 5. Listen. If there was a store opening across the globe from Seattle, Sinegal was there. He wanted to talk to customers and employees, so he could learn more about how to serve them.

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REFERENCES

[1] [2] [3] [11] [12] [13] [21] [22] [23] [31] [32] [33] [41] [42] [43] [51] [61]

San Diego Community College District Mission & Goals, http://www.sdccd.edu/alumni/biographies/jimsinegal.shtml The Good CEO: The Early Years of Costco's Jim Sinegal , http://www.evancarmichael.com/FamousEntrepreneurs/1107/The-Good-CEO-The-Early-Years-of-Costcos-Jim-Sinegal.html Shopping For Success: How Sinegal Took Costco to the Top, http://www.evancarmichael.com/FamousEntrepreneurs/1107/Shopping-For-Success-How-Sinegal-Took-Costco-to-the-Top.html Jim Sinegal: Costco CEO Focuses on Employees, By Amanda Ruggeri, Oct 22, 2009, USA News, http://www.usnews.com/news/best-leaders/articles/2009/10/22/jim-sinegal-costco-ceo-focuses-on-employees On Leadership: Costco chief executive Jim Sinegal, By Jena McGregor, Sep 10, 2011, The Washington Post, http://articles.washingtonpost.com/2011-09-10/business/35275005_1_richard-galanti-warehouse-club-costco James Sinegals Bio, http://www.ceo.com/ceo-profile/james-sinegal/?cpid=3326 The Market's Best Managers Forbes, http://www.forbes.com Brendan Wood International Announces 24 TopGun CEOs in the US, http://www.reuters.com 8 Tips for Business Success from Costco's Jim Sinegal, By Adam Toren, Young Entrepreneur, Aug 14, 2012, http://www.entrepreneur.com/article/224196 http://www.entrepreneur.sdsu.edu Costco's colorful CEO, co-founder Jim Sinegal to retire, By Melissa Allison, The Seattle Times, http://seattletimes.com/html/businesstechnology/2016072309_costco01.html The Good CEO, By Nanette Byrnes , The Magazine, Sep 22, 2002, http://www.businessweek.com/stories/200209-22/the-good-ceo 5 CEOs Who Think Like Steve Jobs did, By Jeff Reeves, The Wall Street Journal, Oct 10, 2011, http://www.marketwatch.com/story/5-ceos-who-think-like-steve-jobs-did-2011-10-10 5 CEOs Who Think Like Steve Jobs, By Silicon India, Jan 02, 2013, http://www.siliconindia.com/news/technology/5-CEOs-Who-Think-Like-Steve-Jobs-nid-137635-cid-2.html What Do Keith Richards and Costco's CEO Have In Common?, By Buck Hartzell, Daily Finance, Aug 23, 2011, http://www.dailyfinance.com/2011/08/23/what-do-keith-richards-and-costcos-ceo-have-in-common/ Jim Sinegal: Costco CEO Focuses on Employees, By Amanda Ruggeri, Oct 22, 2009, USA News, http://www.usnews.com/news/best-leaders/articles/2009/10/22/jim-sinegal-costco-ceo-focuses-on-employees What Entrepreneurs can Learn from Costcos CEO, By Carol Tice, The Entrepreneur, Dec 02, 2011, http://www.entrepreneur.com/blog/220772

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