But never doubt for a minute that Sinegal always focuses on business - namely, doing business the Costco way. All sorts of things make up the Costco way - no advertising and no public relations department; paying industry-best wages and offering among the best benefits in retailing (which drives Wall Street insiders crazy); refusing to mark up anything more than 15 percent (which often drives company insiders who are trying to please Wall Street crazy); even making sure that its parking lots are striped widely enough to handle the vans, Suburbans, and pick-ups many Costco customers favor.
"The average shopper is almost always smarter than Wall Street gives them credit for being," he says. "Everyone assumes consumers will buy what they're told. We give them a chance to buy what they want."
That was more or less the plan when Sinegal and chairman Jeff Brotman put Costco together in 1983. Their idea: Focus on small business owners who need office supplies, let them buy in bulk, and save them enough money so they won't mind paying a membership fee for the privilege. Sinegal and Brotman borrowed from a variety of sources - European retailing, where the superstore concept was long established; traditional U.S. retailers like Sears, which knew how to market house brands like Kenmore and Craftsman; and Price Club, founded by warehouse club pioneer Sol Price (and whose FedMart discount chain had once employed a call clerk named Jim Sinegal).