#107 Sol Price (Costco)

**David Senra** (0:00)
About four years ago, shortly after his death, and a few days after we had lunch together, I received a letter from Sol Price.
Dear Jim, it's always nice seeing you and experiencing your enthusiasm, knowledge, and commitment to your values. You've been very generous about giving me some credit for influencing you. I suspect that's true, but you would have been a great achiever under any circumstance.
Upon reading his letter, I turned to my assistant and said, I've been waiting 50 fucking years for this letter. It was well known that compliments from Sol came about as frequently as Haley's Comet.
After digesting the letter, I reflected on the fact that here I was in my seventies and I'm still seeking approval from this guy.
What was it about the man that engendered so much admiration and respect? Not just from me, but from thousands of us who worked with Sol over the years.
Certainly there was his intelligence and creativity, but that's not the complete answer because as we know, there are millions of bright people in the world and only a handful make a lasting impact.
There was so much more on Sol's leadership qualities that touched all of us and made everyone confident that we would persevere regardless of the obstacles.
I started working at FedMart in 1954 while still in college. A path that was followed by many of Costco's current executives.
Sol gave us incredible opportunities to learn the business, teaching us the skills and core principles we applied throughout our business careers and then later when we launched Costco in 1983
Sol's teachings had a great impact on our business ethics, our core values, and of course, our merchandising philosophy.
He believed in developing strong operating efficiencies and he continually emphasized passing on savings to customers.
We owe our legacy to the retail concept that Sol pioneered with FedMart and Price Club, as do all of our competitors in the industry and big box retailers in general.
Sam Walton, who started Walmart in 1962, eight years after FedMart was founded, later admitted that he had borrowed many of Sol's innovations.
Perhaps Sol's greatest business legacy was the creation of the Price Club concept that as many as a dozen existing retailers and startups attempted to clone.
At one point, a reporter asked Sol how it felt to be the father of an industry, to which he wryly replied, I should have worn a condom.
He was able to be creative and he had the courage to do what was right in the face of a lot of opposition. It's not easy to stick to your guns if you are swimming against the current of traditional thought.
His lessons and philosophy, that business is about more than making money and that a company also has an obligation to serve society, are still valuable reminders for many of us in business today. The fact that he instilled these concepts in so many who were around him is, in my mind, his greatest legacy. All right, so that is the founder of Costco, the protege of Sol Price, Jim Sinegal, writing in the foreword to the book that I read this week, and the one I'm going to talk to you about today, which is Sol Price, Retail Revolutionary & Social Innovator, and it was written by his son, Robert Price. So this book is a great illustration of this point that you and I always talk about, which is books are the original links. You could be reading a book on, say, Jeff Bezos, for example, and you realize, oh, wow, a lot of the ideas that we credit Jeff Bezos for having, he actually learned from Sam Walton and Jim Sinegal. And then you study Sam Walton and Jim Sinegal, and they both say, hey, there was nobody else alive that I learned more from than Sol Price. So that's what we're going to do today. We're going to learn from the life and career of Sol Price. So I want to start with this one sentence It gives you an insight into Sol's personality, but also it talks about why I think this book is so special because it's written by his son. And this is his son writing, he says, For more than 40 years we had worked together. I had learned that my father expected to be fully informed, openly and honestly, even if he did not like what he heard. So I'm going to talk a little bit about Sol's early life so we get a good idea of who he was as a person before we jump into his ideas.
He's a first-generation American. He says, Their immigrant parents, talking about Sol and his siblings, who were poorly educated, unskilled laborers, expected their children to study hard, to go to college, and make their mark as doctors or lawyers. Sol's parents and others of that generation had high expectations. Sol wound up living exceeding their high expectations. He spent the first half of his career as an attorney, which I'll talk a little bit about today. But also, he has the distinction that he's probably one of the few people in the world that founded and took three separate companies public.