Happy employees = profitability!

Posted on June 8, 2013

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From Forbes:
“Costco’s most recent quarterly earnings report reveals a fairly healthy eight percent rate of growth in year-on-year sales—including a five percent rise in same store sales. What’s more, with membership fees rising from $459 million in the same quarter last year to $528 million this year, it’s pretty clear that a significant number of customers are moving over to the retailer to do their discount shopping. Meanwhile, Costco’s primary competitor, Walmart, saw an anemic 1.2 percent rise in sales, while other competitors such as J.C. Penny and Target TGT +0.14% experienced even greater disasters in their sales results. In an identical economy, how do we explain Costco’s growth vis-à-vis the failures over at Walmart? Here’s a crazy thought—might it have something to do with the fact that Costco pays nearly all of its employees a decent living (well in excess of the minimum wage) while Wal-Mart continues to pay its workers as if their employees don’t actually need to eat more than once a week, live in an enclosed space and, on occasion, take their kids to see a doctor?” Read the full article