The Truth About Costco... From a Manager - Part I
Submitted by TotoPullTheCurt... on Sun, 10/09/2005 - 10:57pm.
This is lengthy, please read the enitre article...
Oh Costco, Costco, Costco... is it a religion, or cult, or simply the best/worst place in the world... you hear it all on this page.... people who would give their left nut, first born, or actually pay to work at Costco, but is it all worth it, in the end... is Costco the best thing since sliced bread or just a re-configuration of the WalMart pay scale... People love to shop at Costco, People hate to shop at Costco. I think this can be said for many, many retailors out there, but in the end what does it all mean? What does it matter?
I am a Costco Manager and I will tell you how things work, and the direction that Costco is going in... I am going to give you the insight necessary to make the decession to make your own judgement... I will pull the curtain open, and reveal the Truth about Costco...
Many of you loyal employees will disagree with me, but please keep an open mind, as I have the inside knowledge that you may just not know about, and be able to educate you on the future of this company and your job...
We'll start from the top... The CEO & President, Uncle Jim-bo... he is a spirited innovator, and powerful man... the man is a true beleiver in the great spirit and a great cheerleader/PR Guru for this company, but truth be told, he is getting older, and eventually he will retire, and that's what we all need to be affraid of... Jim has been our employees best friend, holding off the Wall Street Gangsters, and beating them back with his bow-staff... He beleives in the employees so much he doesn't care what the price of the stock does... his replacement, whom ever that may be, will not be able to be as effective, and will crumble to these powerful outside investment forces, who want nothing more that positive numbers, at any cost.
What will these costs be?... Pay cuts, & pay freezes are assured, wait until the next hand book... longer time in between raises... being able to be terminated at anytime for any reason (regardless of how long you've worked there and how loyal you've been)... another crushing blow to the benefits, which now border on insane... I don't want to hear any crap about they are good for retail, that's the must ridiculous thing ever tried to be pawned off on our employees, "there still the best in our industry"... so what... tell that to the single mother when she has to dole out $400 a year in deductable, it cruel, when her loser baby-daddy is a deadbeat and she makes $11.75 an hour working 25 hours a week... They should have never touched the benefits (Thanks California for being so damn responsible for the rate increases on health insurance)...
Sounding like WalMart, be ready...
The bottom line... THE LOWER THE PAYROLL PERCENTAGE... THE HIGHER THE BONUS (from Warehouse managers, and regional managers)...
Oh by the way, here come the SELF CHECKOUTS... they are being rolled out in test locations as we speak...
While we are on the topic of WalMart, let's just look at the model compared to Costco... If you go in to a Walmart there are at least 3-4 employees to 1 Costco employee... let's say for example that WalMart Pays the Average Employee $6.00 an hour, and Costco pays their employee the Topped out pay of $18.00 an hour... If WalMart has the 3 to 1 ratio going on, which company is paying it's employees more? The answer is they are paying their employees identical amounts, when you look at the big picture... The Costco employee is doing three times the amount of work as the typical WalMart Employee, so if that Costco employee represents 3 Walmart employees at $6.00 an hour, it is a compltete wash... Pay (dollar amount) for a store/warehouse is identical, it's just how dole it out... Costco is getting to this point where they must decided how they are going to grow effeciently and effectively when the number of local warehouses grow, the pool of potential high quality "Costco" employees is thinned significantly, so the bleeding begins...
Costco and their promotion policy makes this point even clearer... 80% from within... nice in theory, but a terrible decession, esspecially when the current managers you have are weak... Promote diversity... I am all for a well rounded workforce, but Costco has turned so affraid of lawsuits that they are trying to avoid them, and doing things proactively that we avoid these gender, race, sexual oriented discrimination lawsuits... They are taking whatever steps necessary to promote the following classes at whatever cost (the main cost being promoting unqualified people at the expense of those who are qualified.)
#1) Lesbians---the fact is if your are a Lesbian then your chances of getting promoted are significantly better, no matter how bad you are, becasue it does two things (a. promotes a female, b. promotes a homosexual) upper management (ie corporate jug-heads think its great, two birds with one stone), and I'll give you a specific example. Recently a male assitant manager was demoted for having sex with a supervisor. Within the same time frame a lesbian staff manager was promoted to an assitant manager position, who was also having sex with a supervisor. Where's the equality in this? If I was the one being demoted, I would definately have something to say. This is the kind of behavior that has become acceptable by regional management.
#2) Female---Costco is being sued by an assistant manager in Colorado who beleives that she is being over looked for a warehouse manager position becasue it's a "good-ole boy club." So instead of holding their ground, and saying that she wasn't as qualified, the company has decided to promote several un-qualified female department and staff managers to assistant roles... some buildings now have three assistant managers to cover the available space... is this fair, no, especially if you've busted your ass and someone gets promoted who spells the word oatmeal as follows (I am not making this up) "O-E-T-M-E-E-L" in an IAI search... funny, but true which makes it completely sad... it kind of reminds me of a story about a female police officer who was complaining that more females were not being hired. Well there were two problems, not many females were applying for the positions and those who did apply could not pass the tests required to become a police officer, her retort "they should make the tests easier on females because we are females." That makes me feel safe.
I don't care what color your are, what sex your are, what religion you are, qualified, is qualified... I truely beleive that ALL Costco managers, and supervisors should be required to pass a basic competency exam, as well as have at the minimum an Associates Degree from an accredited College or University (Not University of Phoneix, or other chained colleges.) Education should be rewared. Basic skills are necessary to run the business. Everyone entering a management position should be well versed in the entire Microsoft Suit, and should be experts with Excel. Every Costco manager should be able to pass an advanced financial based math examination. Every manager should be able to pass a psychological profile, with an acceptable rating. These things are not being pushed, and should be. The quality of management would be approved dramitically, which is a win-win for everyone.
This ends part one of of "The Truth About Costco.. From a Manager." It gets better, more actual events and stories from behind the curtain. Coming soon.
Market Data 
Markets 
AI
