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I was not comparing Costco v Walmart. I was responding to companies paying high wages in "today's environment"

• maxerickson 10y ago
  Right, but it isn't really clear that Costco pay's particularly high wages for the business it is operating.
  • Zhenya 10y ago
    It's absolutely clear. Their workers are retail employees who provide near substitutive type of labor as wal-mart employees. They consciously raise wages to retain employees. http://www.bloomberg.com/news/articles/2013-06-06/costco-ceo-craig-jelinek-leads-the-cheapest-happiest-company-in-the-world http://www.bloomberg.com/news/articles/2013-06-06/costco-ceo...
    • nickff 10y ago
      That's what Costco says, but I'd be willing to bet that Costco and Walmart employees are quite different. I would bet that Costco employees had more years of education, and more successful (i.e. years not fired for cause) work experience. When you are willing to pay more, you can purchase higher quality; this is as true for labor as software or electronics.
      • nickpsecurity 10y ago
        " I would bet that Costco employees had more years of education, and more successful (i.e. years not fired for cause) work experience." You'd loose money. I've met many Costco employees. Most were either high-school students or older people without degrees who simply applied for the job or were referred then got through an interview. They care more about whether you'll work hard than anything else. Then they tend to stick around longer since they get paid and treated really well so long as they work hard. Lots of retail workers would like a job at Costco or a similar place but there's just few openings since people don't quit often.
        • nickff 10y ago
          Neither Costco nor Walmart will have anything near the average level of education of the average HN commenter, but I maintain that there is almost certainly a difference
          • nickpsecurity 10y ago
            They pull people out of high schools, retail jobs, etc. They wont hire outright idiots but there's no IQ test or anything. Think about it another way: these people are going to Costco because they lack what's needed to get higher-paying jobs requiring degrees or trade schools. Costco reps themselves already explained the extra pay was just incentive and that they believe in living wages. They also cancelled the ad bugdet specifically to give that money ("6% of revenue") to workers instead thinking good workers are better than advertising for customer retention. So, they consistently believe paying & motivating workers has highest benefits. They also pull from barely-educated sources who probably have above-average intelligence or character but still the common, low-rung pool of labor.
    • adventured 10y ago
      If you want Walmart to match Costco on pay, it has to fire between 1/3 and 1/2 its employee base and replace them with robotics or other automating technology. Sales per employee Costco: $550,000 Walmart: $200,000 So now you need to find low skill jobs for a million people, at a time when automation technology is aggressively seeking to (and increasingly able to) wipe out those types of jobs. Oh yeah, and Walmart is very likely in permanent contraction mode already, in which its business will perpetually shrink on a year over year basis ala Sears and other past giants of retail, as Amazon + its far greater automation eats them. Good luck.
  • brianwawok 10y ago
    Why does a store selling items in bigger boxes need to pay more?
    • maxerickson 10y ago
      I don't know that they need to, but I can see where it would be beneficial to pay more if it led to better service of the more affluent customers that frequent the stores. The point about the large packages and much smaller number of items was more that they need less labor to keep the shelves full.