The average customer visits their local Costco 22 times a year. The company has become one of the largest in the U.S., with 473 outlets and more than $50 billion in sales, and is also the largest membership warehouse club chain in the world. Its founder and CEO, Jim Sinegal, has been called the Sam Walton of the 21st century for his low-key style and seeming defiance of all things Wall Street. But, whether investors like him or not, America and much of the rest of the world has fallen in love with his discount depots.
The son of a steelworker, Sinegal has come a long way to get to where he is today. Born on January 1, 1936 in Pittsburgh, Pennsylvania, James D. Sinegal was raised in a typical working-class Catholic family. As a boy, the young Sinegal dreamed of going to medical school. He graduated from Helix High School in 1953 and decided he would try to make his dream a reality by applying for enrollment in San Diego State University. However, that dream was short-lived.
My test scores were good, but my grades weren't that good, because I needed focus, recalls Sinegal, who was advised to first apply for a short program at San Diego College. There, he not only earned an associates degree, but he also got back his motivation and concentration. It was at San Diego Junior College (now City College) where I regained that focus, and paid attention, says Sinegal, because deep down I knew education was important. It was what Sinegal would do next that would lead him to in fact become chosen as one of City Colleges Most Distinguished Alumnus.
After earning his degree, Sinegal finally enrolled in San Diego State University. To help support himself through school, he applied for a job at Sol Prices newly expanding Fed-Mart. The 18-year old Sinegal was given the task of unpacking mattresses as they arrived. It wasnt that great a job, he says. I was getting a buck and a quarter an hour. But it was exciting.
It was at Fed-Mart that Sinegal discovered his passion for retail. Within just a few years, he had been promoted to store manager. He soon quit his university studies and devoted himself full-time to Fed-Mart. Eventually, Sinegal would rise to become the executive vice president of the chain.
In 1979, Price decided to abandon Fed-Mart and start a new venture, and he wanted to take Sinegal with him. Over the years, Sinegal had proven himself a loyal and hard worker, and Price did not want to lose him. Sinegal agreed, and together, the two created Price Club. Initially, Price Club was meant to service small business owners, but eventually its membership became open to the public. Sinegal was executive vice president and was the major driving force behind helping his former Fed-Mart boss establish the new company.
By 1981, Sinegal realized he had been working with Price for almost 30 years. It was time for him to move on. Both Fed-Mart and Price Club had been a success, but Sinegal wanted to do something for himself. That year, he decided to leave Price, to give up his secure job, and to risk it on all on his own.