Acquired · Costco
Founders · Mar 22Sol Price: The Founder Who Taught Jim Sinegal, Sam Walton, Jeff Bezos, and Bernie Marcus
Opened with $50,000 and a lease cancelable after one year, and did three times its projected $1 million in year one. It paid $1 an hour in every city, fought fair trade laws, and Price lost it after selling 64% to Hugo Mann.
Tips
- Sol Price paid San Antonio staff the same dollar an hour as San Diego▶ 29:00Everyone wanted to work at Fedmart, the same pull Costco later showed when 22,000 people applied for 200 jobs.
- Sol Price sold 64% of Fedmart to Hugo Mann and was pushed out▶ 42:42Mann took 64% of Fedmart, and Price lost control and was removed.
- Sol Price copied Fedco and then changed it into a membership store for all▶ 19:30Fedmart opened with about $50,000 raised and did three times the million dollars projected in its first year.
- Sol Price used membership and private label to get around fair trade laws▶ 32:37FM laundry detergent sold at about half the price of the national brand, and a judge sided with Fedmart on liquor pricing.
- Sol Price opened Fedmart with a lease he could cancel after one year▶ 25:30Fedmart raised $50,000 from a handful of investors, including Price's own $5,000.
- Sol Price refused a mortgage clause requiring segregated bathrooms and the lender backed down▶ 30:10The lender removed the segregation provision from the mortgage agreement.
- Sol Price brought discount drugs to stores despite threats against his pharmacist▶ 31:40Costco still sells prescription drugs cheaper than almost all competitors.
- Sol Price started with ignorance of retail and treated it as an advantage▶ 21:43Fedmart opened to an immediate and spectacular success, doing three times its projected first year sales.
