3.27.2004

Planned a number of updates, but this is an article we really need you to read:

Costco's Dilemma: Be Kind To Its Workers, or Wall Street? The Wall Street Journal (3/26)

When it comes to workers, companies can be accused of not paying enough -- or paying too much.

Wal-Mart Stores Inc.'s parsimonious approach to employee compensation has made the world's largest retailer a frequent target of labor unions and even Democratic presidential candidate John Kerry, who has accused the Bentonville, Ark., chain of failing to offer its employees affordable health-care coverage.

In contrast, rival Costco Wholesale Corp. often is held up as a retailer that does it right, paying well and offering generous benefits.

But Costco's kind-hearted philosophy toward its 100,000 cashiers, shelf-stockers and other workers is drawing criticism from Wall Street. Some analysts and investors contend that the Issaquah, Wash., warehouse-club operator actually is too good to employees, with Costco shareholders suffering as a result.

"From the perspective of investors, Costco's benefits are overly generous," says Bill Dreher, retailing analyst with Deutsche Bank Securities Inc. "Public companies need to care for shareholders first. Costco runs its business like it is a private company." [ed: emphasis ours]

Read for yourself and please do not shop at Wal-Mart. (sorry for the messed up post; did it quickly and late)

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