excelled during the pandemic as customers loaded up on basics. Now, it is racking up monthly sales gains of better than 20% as the U.S. economy reopens and consumers splurge.
The company’s success reflects the work of CEO Craig Jelinek and a veteran management team, who believe in treating both customers and employees well. Jelinek, 68, worked his way up during a 37-year Costco career, replacing co-founder Jim Sinegal as CEO in 2012.
Jelinek avoids the spotlight and is one of the few CEOs in retailing who doesn’t regularly participate in quarterly earnings calls. Reflecting Costco’s informal culture, he wants employees to call him by his first name.
Costco operates about 550 stores in the U.S., and about 250 overseas. It won’t mark up prices on branded products by more than 14%. Its employee relations also win plaudits; earlier this year, it boosted its minimum wage to $16 an hour, and its average wage for hourly workers is $24 an hour. Turnover is exceedingly low; just 6% of workers leave after the first year.
Costco’s stock is up nearly five-fold in the past decade and trades for 35 times forward earnings, one of the highest price/earnings ratios among big retailers.
Write to Andrew Bary at [email protected]