Jim Sinegal, every mention
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every year anyone David Rosenthal 51Ben Gilbert 23Charlie Munger 7Howard Schultz 5David Senra 1
Verbatim, from the transcripts: the passages where Jim Sinegal comes up
Vanguard: The communist capitalist who saved investors a trillion dollars (Audio) · Acquired
- ▶ 1:34:54 David Rosenthal Even Saul Price and Jim Senegal were not this fanatical.
Trader Joe’s: Hawaiian shirts and counter positioning (Audio) · Acquired
- ▶ 1:37:42 David Rosenthal Like, I genuinely think they feel that way, and it's another take on the same thing that Costco and Saul Price and Jim Sinegal had about why they don't do sales, and Trader Joe's also doesn't do sales and doesn't have coupons.
- ▶ 2:07:46 David Rosenthal Jim Senegal built Costco, the scale Costco we know today.
IKEA (Audio) · Acquired
- ▶ 13:35 David Rosenthal Jim Senegal, Saul Price, Jeff Bezos, Ingrid Comrade.
- ▶ 1:02:57 Ben Gilbert In preparation for this episode, I talked to Jim Senegal, who's the co-founder of Costco, because I was asking about Ikea and the similarities, and he said he used to love going to Ikea to look at the KD furniture that they stocked.
- ▶ 1:14:39 Ben Gilbert Okay, so I brought this up with Jim when I was talking about similarities between Costco and Ikea.
- ▶ 1:14:44 Ben Gilbert He did not believe that Ikea copied the Costco hot dog.
- ▶ 1:14:49 Ben Gilbert And here was his rationale.
- ▶ 1:14:52 David Rosenthal I don't believe him.
- ▶ 1:15:10 David Rosenthal Jim is a very, um, kind and, uh, generous soul, despite being one of the greatest retailers of all time.
- ▶ 2:56:25 David Rosenthal I think they're a merchant at heart, and Ingvar was a merchant at heart in the same way that Sam Walton and Jim Senegal and Saul Price and Jeff Bezos were and are.
- ▶ 3:20:19 Ben Gilbert We want to give three special thank yous to Jim Senegal, the co-founder and former CEO of Costco, for his
Starbucks (with Howard Schultz) · Acquired
- ▶ 1:08:26 Ben Gilbert Did you ever speak with Jeff Protman or Jim Senegal or any of those guys about this concept?
- ▶ 1:08:48 Howard Schultz Jeff became a board member of the early imprinting of Starbucks, and clearly a mentor, mentor of mine, and then he introduced me to Jim Senegal, and so
- ▶ 1:09:02 Howard Schultz There were many moments of me sitting with Jeff and Jim, including the huge decision to put Starbucks coffee in Costco, which there was a revolt inside the halls of Starbucks saying, no effing way.
- ▶ 1:09:23 Howard Schultz And Jeff and Jim took me to a parking lot
- ▶ 1:10:14 Howard Schultz So Jeff and Jim were instrumental in so many things, and were so kind to me as a young kid.
- ▶ 1:13:08 David Rosenthal Do you know where Jeff Bezos and Jim Senegal met for the first time?
- ▶ 1:13:27 Howard Schultz And I still am friendly with Jim Senegal today.
Holiday Special 2023 (Audio) · Acquired
- ▶ 17:05 Ben Gilbert It's almost like a discovery of laws of physics, the way that Saul Price and Jim Senegal and the rest of the crew have sort of built that business over the years.
- ▶ 1:55:46 David Senra Sam Walton, Jim Senegal, Jeff Bezos, Bernie Marcus.
Charlie Munger (Audio) · Acquired
- ▶ 9:31 Ben Gilbert And so how did you eventually meet Jim Senegal?
- ▶ 9:34 Charlie Munger Well, San Diego asked Warren to become a director of Costco.
- ▶ 19:13 Charlie Munger Now, in Costco's case, they had Jeff Brotman, who's very smart, but not a retailer, and Jim Senegal, and they divided it up, and they had originally agreed that Brotman would be the chairman and CEO, because he was his idea.
- ▶ 19:27 Charlie Munger He founded the whole thing, but Senegal decided, no, I have to be the CEO.
- ▶ 27:54 Charlie Munger How did Jim and you feel about that?
- ▶ 50:17 David Rosenthal And Jim forbade him.
- ▶ 50:19 Charlie Munger Well, I'm sure Jim would have forbade it.
- ▶ 51:25 Charlie Munger And that made such a bad impression on Jim Senegal.
- ▶ 51:29 Charlie Munger He wouldn't even talk to him going into China for about 30 years thereafter.
Costco (Audio) · Acquired
- ▶ 5:14 David Rosenthal So, Costco was founded, as many people know, in Seattle, lovely city of Seattle, in 1983 by retail veterans Jim Senegal and Jeffrey Brotman.
- ▶ 5:43 David Rosenthal And, uh, Jim, well, we'll talk about Jim as we go here.
- ▶ 8:57 David Rosenthal Jim Senegal, of course, co-founder, CEO of Costco.
- ▶ 9:00 David Rosenthal Jim tells the story that a reporter once asked him if he learned a lot from Saul, and Jim replied, no, that's inaccurate.
- ▶ 25:42 David Rosenthal One, Jim
- ▶ 25:44 David Rosenthal Senegal.
- ▶ 25:45 David Rosenthal And Jim would end up working for the next 22 years at FedMart directly for Sol.
- ▶ 25:55 David Rosenthal Eventually, Jim ends up running FedMart's entire distribution and centralized warehousing operations.
- ▶ 31:02 David Rosenthal He passes that down to Jim Senegal.
- ▶ 31:04 David Rosenthal It's anathema to Jim.
- ▶ 33:39 David Rosenthal I mean, Jim started as a grocery bagger in the fifties at FedMart.
- ▶ 41:37 David Rosenthal Jim Senegal.
- ▶ 43:49 David Rosenthal And that is the division that Jim Senegal ran, the Centralized Warehousing Operations.
- ▶ 44:09 David Rosenthal You really could say that Jim ran our warehouse operations kind of like its own business.
- ▶ 44:47 David Rosenthal So they're like, well, is there a way that we could take Jim's operation, recreate it, and make that the core business instead?
- ▶ 46:49 David Rosenthal There's one piece in particular that really, really makes this a crown jewel, and it's the reason why they were so enamored of what Jim was doing.
- ▶ 48:39 David Rosenthal Jim Senegal, after, I think he was probably locked up at FedMart under new management for a while, after that he would come over and briefly work at Price Club a couple years later, so like, the best of the best are coming through this…
- ▶ 1:09:53 David Rosenthal His name is Jim Sinegal.
- ▶ 1:10:00 David Rosenthal Jeff calls Jim, convinces him to come up to Seattle.
- ▶ 1:10:07 David Rosenthal So Jim moves up to Seattle, they start Costco, and the business plan is really pretty much exactly just Clone Price Club.
- ▶ 1:10:17 Ben Gilbert And Jim really is Saul's protege.
- ▶ 1:11:04 David Rosenthal So Jim moves up to Seattle.
- ▶ 1:12:18 David Rosenthal So, this new Costco under Jim hits a billion dollars in revenue in less than three years after getting started.
- ▶ 1:13:44 David Rosenthal So, Price Club was certainly doing fine, it wasn't declining, but Jim and Jeff at Costco, and certainly Sam at Walmart and Sam's Club, they are pedal to the metal, aggressively expanding, and that's not really Saul and Robert's MO.
- ▶ 1:14:55 Ben Gilbert And at the end of the day, Price Club was either gonna land with Walmart or with Costco, and Sol Price didn't want it to be Walmart, and very, very much wanted to join forces with Jim Senegal.
- ▶ 1:15:11 Ben Gilbert successor for this combined business in Jim Senegal?
- ▶ 1:15:14 David Rosenthal Now, interestingly, the transaction really is about as close to a merger of equals as I think we've ever seen on the show, with the caveat that Jim is clearly gonna be the CEO that's gonna run the combined company.
- ▶ 1:16:31 David Rosenthal It wasn't just that Jim had a soft spot for his mentor, Sol, and for Price Club.
- ▶ 1:18:30 David Rosenthal Jim Senegal.
- ▶ 1:18:32 Ben Gilbert So they really are, when I say ideologically similar, or the natural successor, or almost like another son of Sol Price, Jim Senegal and Sol Price really are of one mind in many ways.
- ▶ 1:23:30 Ben Gilbert And so Jim Senegal has a great quote on this.
- ▶ 1:28:44 David Rosenthal So there's a really fun acquired canon, acquired cinematic universe story related to this, which is the famous, as chronicled by Brad Stone in the Everything Store, coffee date between Jim Senegal and Jeff Bezos in 2001, which occurs at…
- ▶ 1:29:30 David Rosenthal Jeff has this coffee with Jim, and Jim explains this philosophy to Jeff.
- ▶ 1:29:50 David Rosenthal Henceforth, as of today, Amazon is a company that works hard to charge its customers less, and that is directly from Gin Senegal.
- ▶ 1:31:00 Ben Gilbert And Jim Senegal articulates, if we do these four things throughout our organization, and again, those four things are,
- ▶ 2:15:50 David Rosenthal And Amazon today has really become something else from what Jeff wanted it to be after his coffee with Jim Sinigal.
- ▶ 2:18:52 Ben Gilbert Very famously, as David and I talked about, the hot dog and drink combo has been a dollar 50 for many, many years, and when Jim Senegal handed over the reins to Craig Jelinek, Craig went to him and said, you know, hey, we're close on…
- ▶ 2:19:10 Ben Gilbert And of course, Jim Senegal looks at him and goes, if you raise the price of the hot dog and drink combo, I will effing kill you.
- ▶ 2:23:28 Ben Gilbert To open this section, I want to say a Jim Senegal quote.
- ▶ 2:32:03 Ben Gilbert It's not the same person all the way through, because it's Sol Price, it's Jim Senegal, it's all the executives
- ▶ 2:33:42 David Rosenthal Jim went to San Diego City College, right?
- ▶ 2:48:34 David Rosenthal Saul Price, Jim Senegal, Craig Jelinek.
- ▶ 2:50:44 David Rosenthal Yeah, so Jim and Jeff Brotman, before he tragically too young passed away a few years ago, they would talk about this, especially Jeff and the Brotmans being Seattle retailers.
- ▶ 2:53:44 David Rosenthal Jim talks about this a lot in the talks I watched on YouTube, that when he was CEO, and I think Craig does the same thing to this day, he visited every store every year.
Amazon.com · Acquired
- ▶ 3:23:53 David Rosenthal Jim Senegal and Jeff are buds.
- ▶ 3:23:58 Ben Gilbert And at least Jeff credits a particular lunch with Jim from teaching him a lot of lessons.
- ▶ 3:24:53 David Rosenthal But yeah, no, so this coffee where they meet for the first time, Jim from Costco is just like, ugh, I've never met him, but he must just be such a mensch.
- ▶ 3:25:11 David Rosenthal Like you gave a lot of key information to Jeff Bezos, who, you know, you became friends with, and then he certainly one of your biggest competitors and, you know, Jim's response is just like, this is retail.
- ▶ 3:25:34 Ben Gilbert And Jim famously has said that some of his highest performing Costco's are across the parking lot from Sam's Clubs.
- ▶ 3:25:41 David Rosenthal Yeah, so actually the purpose of the meeting was that Jeff wanted to pitch Jim on, uh, this was like early days when they were expanding the categories on Amazon, and there was a bunch of products that they couldn't get yet.
- ▶ 3:25:56 David Rosenthal So Jeff wanted to pitch Jim on Costco selling
- ▶ 3:26:06 David Rosenthal But yeah, Jim gives him like this masterclass on the Costco model, and it sounds insane if you're not familiar with it from the outside, but then makes total sense if you realize you're focused on gross margin dollars over the life of a…
- ▶ 3:29:56 Ben Gilbert In order to give them two-day shipping, and then this Jeff realization from Jim Senegal at Costco of, wait a minute, if we charge people anything, they'll actually be more loyal, which is the ultimate thing that we care about.
- ▶ 4:05:55 David Rosenthal Entrepreneurs starting concurrently and before Sam Walton, but Saul Price, Sam Walton, Jim Senegal, Jeff Bezos.
Walmart · Acquired
- ▶ 1:13:43 Ben Gilbert Isn't there something like Jim Senegal worked at Price Club, or was like a disciple of Sol Price?
- ▶ 2:21:29 David Rosenthal So, Saul Price, of course, as we talked about, and Jim Senegal, who worked for him, were big pioneers of the shopping club, you know, Costco, Price Club, Sam's Club model.
- ▶ 2:22:02 Ben Gilbert That was totally Sam Walton's thing to variety stores and totally is Jim Senegal's thing to Sam Walton.