Video: How Costco's CEO Sizes Up the Competition

By Mac Greer | More Articles
September 23, 2009 | Comments (1)

Megaretailer Costco (Nasdaq: COST ) has produced many happy returns for investors. Shares of Costco have risen by about 40% over the past five years, outperforming competitors such as Wal-Mart (NYSE: WMT ) , BJ's Wholesale Club (NYSE: BJ ) , and Target (NYSE: TGT ) . Berkshire Hathaway (NYSE: BRK-B ) Vice Chairman and Costco board member Charlie Munger has said that "virtually none of the sins of modern capitalism are at Costco."

Costco CEO Jim Sinegal recently stopped by The Motley Fool to talk about his supersized business. In this first of three video installments, Sinegal talks about one way he checks out his competitors.

Coming Thursday: Jim Sinegal on his greatest weakness.

Listen to the entire audio interview of our conversation with Costco Jim Sinegal at www.motleyfoolconversations.com, or subscribe through iTunes.

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Mac Greer owns shares of Costco, which is a Motley Fool Inside Value and Motley Fool Stock Advisor recommendation. The Motley Fool owns shares of Costco. The Fool's disclosure policy enjoys both the little things in life and warehouse retailers' bulk items.

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Report this Comment On September 23, 2009, at 11:06 PM, deadlysaber wrote:

Believe it or not I found an amazing investment vehicle at the most unlikely of locations, Costco. How often do you go to any kind of wholesale or retail outlet with the goal of leaving with a product that would actually pay some kind of dividend in my career? For me the number would be somewhere between zero and nil.
Normally a trip to our favorite big box store ends the same way. We leave with a full cart and a somewhat slimmer bank account. But our last visit was different. Our dividends could potentially total into the millions.
Now was this item put on the shelves as an investment device? I seriously doubt it. They probably brought it in because of its high impulse buyer appeal. I'd seen it a few days prior when I was wandering through the store killing time. This is not a normal activity (the killing of time) but we were waiting for a prescription to be filled for my granddaughter. I noticed that Costco was now carrying a small series of educational cds and dvds. This caught my attention as I love to learn and have a slight addiction to self-development material. Even though I found some of the topics intriguing I decided against buying them because the aforementioned addiction has created a sizeable library already.
When I got home I proudly mentioned to my wife how I looked at the motivational and educational material and had summoned the willpower to walk away without buying. Her reaction was to question my judgment (not the first time) after I told her how small the price they were asking.
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Money without intelligence is like a car without a road.
http://www.intelligentinvestingtips.com

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