Craig Jelinek has big shoes to fill.
But Costco’s new chief executive officer said he does not intend to try to fill the shoes of Jim Sinegal, the co-founder of Costco Wholesale Corp. in Issaquah, Wash., who retired as CEO in January.
“I can’t be Jim Sinegal — I can only be Craig Jelinek,” he told SN. “I’ve spent 28 years working with ‘the legend,’ and hopefully I’ve learned a lot from him.”
According to Jelinek, there’s not much need to make changes, even if he was so inclined. “This is not a company that’s in trouble,” he pointed out, “so there’s no need to make a lot of changes — that would be the worst thing anyone could do.
“We have a very strong culture here, and I’m part of that culture, and I’m very comfortable moving forward without making any changes.
“We’ve always been open to trying things if they have been thought through. But our view is, we want to keep the business pretty much the way it is.
“We will run the business to give the best possible value to our members, which means we want to be the last ones to raise prices. But we’re not in business to get more margin, and we will never sell below cost.
“We will maintain the same pricing disciplines we always have to achieve 14% margins, and that’s won’t change. And if we can’t bring value to members, then we will drop a product.”
Chuck Cerankosky, an analyst with Northcoast Research, Cleveland, said Jelinek appears not to have orchestrated any noticeable changes. “The warehouses have continued to perform well, and store visits would indicate the company has retained its retail style.
“It continues to be a very strong operator that has maintained its great retail disciplines for many years, and that has allowed it to come out of the economic downturn better than most retailers, with a strong balance sheet to boot.”
Jelinek, 60, has been with Costco since 1984, when he joined the company as manager of its sixth warehouse; he became manager of Costco’s California region a year later.
He held a variety of regional executive posts at the company before he became executive vice president, merchandising, for Costco in 2003. He was named president and chief operating officer in 2010, at which point it was clear he would succeed Sinegal as CEO.