Co-Founder and Former CEO of Costco Wholesale Speaks on Global Strategy and Management
Jim Sinegal, co-founder of Costco Wholesale Corporation, discussed Costco’s success in the retail industry, as well as its strong corporate management, innovative business model, and forward-thinking strategy on Nov. 21 at Georgetown’s McDonough School of Business, during an event hosted by the Georgetown Retail & Luxury Association (GRLA) and the Global Business Initiative (GBI). [Watch the full video.]
In 1976, Sinegal co-founded Costco Wholesale Corporation, which is now one of the world’s largest retailers, creating a paradigm shift in the retail industry. Until his retirement in 2011, Sinegal led Costco as president and CEO.
“Selling merchandise at low prices is something that anybody can do,” Sinegal said. “The secret is to do that and make a profit.”
Sinegal discussed the lessons learned from the company’s first international expansion to Canada.
“We were originally based in Seattle and felt a very natural step to start international operations in Canada,” he said. “This turned out to be a great opportunity to watch closely how to adapt to new regulations and even use two languages. Through our gradual international expansion, we have found that the concept of saving and having value can be translated into various countries and be accepted.”
Ricardo Ernst, Baratta Chair in Global Business and GBI director, asked Sinegal about Costco’s decision to create the signature brand, Kirkland Signature, back in the 1990s during their moderated discussion. The name, Sinegal said, was that of their home office.
“As we were expanding into England and Scotland, we noticed a resurgence in private label products, especially in London where many retailers were being successful, so we thought we should get involved in that,” he said. “We were present in many countries and had such a wide array of products that having just one label for our private brand made perfect sense. Someone from our team came with the Kirkland name, which we then cleared in all countries where we were present.”
In addition, Sinegal discussed the company’s recent success in opening its first store in China.
“It took us a long time to make a determination that we could do business in the country,” he shared. “We have found that American products are very popular in many of our Asian locations. We are always all over the world scouting the market looking for the next exciting product. We like to be the first ones to show them to our customers.”