Costco makes changes at glacial speeds. The warehouse club rarely innovates because it is not necessary.
Its members do not pay for cutting-edge technology. The company's customers don't need out-of-the-box technology, inventory-taking robots, or any other extravagance. They simply want really low prices from a company that puts all its resources into offering the best possible value.
That's a Costco thing. (COST) – Get a free report has been successful in. The company has been a port in the storm during the Covid pandemic and the period of inflation that followed.
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At a time when many people were worried about money, Costco stayed true to its mission. He made dramatic moves, such as operating his own shipping fleet to continue offering his members the values they expected.
The warehouse club still offers an easy shopping experience. While rivals like Target, Walmart and Amazon have invested billions in digital order fulfillment, Costco has kept its online offerings limited but offers same-day delivery through its partnership with Instacart.
This is a pretty brilliant solution where Costco members get same-day service, but the warehouse club doesn't have to spend any money to offer it. It's another example of the chain's slow and steady approach of putting members first.
Now, as 2023 ends, the member-based chain has a big move planned, but it should be able to pull it off without a hitch.
Image source: Xinhua/Ting Shen via Getty Images
Costco about to have a new CEO
On New Year's Day, former Costco CEO Craig Jelinek will step down. He will be replaced by current president and CEO Ron Vachris. It is a move that the company has been planning for quite some time.
“Craig and Ron have worked hand in hand for the past twenty-one months in Ron's role as president and for many years before. This is the culmination of the long-standing succession plan that Craig has discussed with the board,” Costco shared. in a press release.
Vachris has worked at Costco for more than 40 years. He literally started out as a “forklift driver and subsequently performed all significant roles related to Costco's business operations and merchandising activities,” according to the statement.
Jelinek will remain in the advisory role through April and plans to remain on Costco's board of directors.
Costco wants to be boring
CFO Richard Galanti Addressed CEO Change During Costco Presentation first quarter results call.
“At the end of the day, the reality is that we stay the course. You know, I remember questions being asked more than 12 years ago when Craig became president, and two years later, Jim retired and Craig became CEO and president. You know, 'who can replace Jim?' and I think the same questions are being asked today: 'Who can replace Craig?' and it really is a seamless transition,” the CFO shared.
He noted that both have had an incredible history with the company.
“There's someone who's retiring who's been here for 40 years or so and who's been in the business, both in operations and marketing, for a successful number of years in both. And there's Ron, who's coming, who started when he was 17 years old in a price club in Arizona, and he already has his 40-year golden patch, and again, 30 years in operations, a year in real estate traveling the world, and then seven, or six or seven years in marketing,” he said. aggregate.
Costco stock had an impressive run in 2023, gaining about 45%. The company will also pay a special dividend of $15 on January 12 to shareholders of record as of the close of business on December 28, 2023.
