Success Quote by James Sinegal

Costco’s whole magic trick is that it only works if its customers stay solvent. James Sinegal’s line sounds almost disarmingly obvious, but that’s the point: it’s a rebuke to the version of capitalism that treats workers, shoppers, and even communities as disposable inputs. When he says “it doesn’t do Costco any good,” he’s framing affordability not as charity but as self-preservation. The company’s success depends on a middle class with enough breathing room to buy in bulk, renew memberships, and come back next week for the rotisserie chicken and the “accidentally” oversized cart.

The subtext is a quiet argument against short-term extraction. If wages stagnate and prices climb, retail turns into a hollow machine: stores can be full of inventory and empty of demand. Sinegal is also implicitly justifying Costco’s signature choices - higher pay, benefits, low markups - as a business strategy that assumes consumers aren’t an infinite resource. He’s telling investors and competitors: you can squeeze margins or squeeze people, but squeezing people eventually squeezes you back.

Context matters here. Sinegal built Costco during decades of widening inequality and a corporate culture obsessed with quarterly wins. His remark reads like a corporate conscience, but it’s really a supply-chain-level realism about power: the consumer economy is only as strong as the paychecks that feed it. If people can’t afford anything, the “membership model” isn’t a moat; it’s a tollbooth at the edge of a deserted road.