Photo:
Rosa Say/Flickr
"I really wish I had worn a condom."
- Sol Price, the founder of Price Club (and later Costco),
when some discount retail executive told him that he's
the father of the warehouse discount retail concept.
Do you love Costco? I love Costco ... maybe a little too much. I've been
a member of Costco since the Price Club days (Costco merged with Price
Club in 1993 and became PriceCostco. In 1997, the company changed its
name to the Costco Wholesale you know and love - more on that below).
Back in those days, Price Club didn't use barcodes - instead, the checkout process consisted of an unloader and a cashier. The unloader took your items out of your shopping cart and yelled out the item numbers to the cashier. The cashier typed in the item numbers one by one into the cash register. Oh, and back then, it was still possible to get parking on a Saturday morning.
If there's one thing I know about Costco today is that it's impossible to leave the store without spending at least $100. Once, I was on a mission: to get that one thing I need at $50. I went straight to the item, grabbed one, and went to the checkout line without looking at anything else or (gasp) even sampling their food. I thought I had outsmarted them. When I got to the cashier, she informed me that I had to renew my membership at $55. Total spent (before taxes): $105! Hah!
Anyways, here are 10 most fascinating facts about Costco:
1. The concept for Costco was drawn up on a napkin
Like I mentioned above, the Costco we knew and love today started out
as Price Club, which was founded by legendary businessman Sol Price*.
In 1975, Price was forced out of a chain of discount department store
company he founded called FedMart**. Shortly after, he drew up
the concept of a "warehouse
store" retail model on a napkin.
A few of Price's friends and associates put together $2.5 million seed money for the first Price Club, which opened in 1976 (more below). Their first week's sale was downright disappointing. Price said, "It was terribly slow. Our sales were only about $32,000 in our first week, and it got worse from there."
To make it seemed that the store was busy with customers inside, Price
made his employees park their cars near the warehouse entrance. Luckily,
sales improved and Price Club was off and running.
*What a perfect name for retail, huh? Legend has it that when his parents
Samuel and Bella, immigrated from Minsk, Russia, the clerk at Ellis
Island misheard "Press" or "Preuss" and wrote down
"Price."
**Another neat trivia: In the 1960s American businessman Samuel Moore
"Sam" Walton opened his own retail store and decided that he
liked the "Mart" in Price's "FedMart" name so much
that he decided to name his store after it. That store? Wal-Mart.
2. Costco's first store: A converted airplane hangar
The first Price Club store we mentioned above was located in a converted airplane hangar once owned by Howard Hughes on Morena Boulevard in San Diego. The store only sold to small businesses, who could "invite" non-business members. That created a "secret club" mentality that appealed to many people.
This store is still in operation today.
3. Costco's main layout is called "The Race Track"
Costco purposely put fresh food at the back in the store, to make sure that their customers pass by every category of items - electronics, clothing, jewelry, amongst others - as they wind their way down "The Race Track" to the food section.
This strategy obviously works because, as I mentioned above, it's impossible to get out of Costco for less than $100.
