Fortunes, Feb 3, 2014 (II)

choi

Caroline Fairchild, Bulking up Abroad. How Costco is turning its no-fuss wholesale business into a global brand. (under the heading World’s Most Admired Company.
money.cnn.com/2014/01/16/leadership/costco-expansion.pr.fortune/

Quote:

“The wholesale retailer [Costco]was founded in 1983. It is the biggest specialty retailer in the US and the only top-10 specialty retailer with a membership model. Low prices, expert merchandising, and industry-high employee wages are what's behind Costco's success. Now its executives are pushing wholesale shopping internationally. They're getting results: Overseas sales more than doubled from 2008 to 2013.”  from Paragraph 1 shown in the URL

“[section heading:] EMPLOYEES BEFORE PROFITS  Unlike most retailers, Costco does not see raising employee salaries and growing profits as competing goals. While the average hourly wage for a full-time worker at Wal-Mart is $12.81, Costco pays its workers an average of nearly $21. Costco sees the return on this investment in its low employee turnover rates: Just 10% in 2013 and 7% for employees who have worked at least one year (Wal-Mart and Sam’s Club refused to disclose turnover rates after repeated requests.) High employee retention allows the wholesaler to cut down considerably on training costs. Costco’s founders set out to pay ‘a good living wage,’ says chief financial officer Richard Galanti. ‘We are never going to mess with that.’
  
My comment:
(a) There is no need to read the rest.
(b) Compare

Jayne O'Donnell and Alicia McElhaney, Costco’s Model May Explain Its Pay. Warehouse retailer has fewer employees. USA Today, Jan 30, 2014, at page 2B.
www.usatoday.com/story/money/bus ... wage-obama/5029211/

Quote:

"others say the Costco membership stores have such a different business model and customer base that Costco can't be compared with other retailers. Costco 'has half the number of employees per square foot (of Walmart [sic]), is a much smaller company, its stores are only in affluent areas and people are buying in bulk,' says Richard Berman, who runs a business advocacy group opposed to a minimum wage increase. * * * according to Bloomberg BusinessWeek, its employees make an average wage of about $21 an hour.

"Costco has annual worker turnover of less than 6%, low for a retailer, according to [Occidental College politics professor Peter] Dreier. He says this cuts costs and lets Costco pay higher wages.

(c) The German and Jewish (Ashkenazic) surnames Dreyer/Dreier are "from German drei ‘three.’" (Why three? Unknowable.)

choi

Vivienne Walt, Norway’s Trillion-Dollar Oil Problem. Thanks to petroleum riches, Norway’s sovereign wealth fund is minting money. The challenge?  How to spend it all.
money.cnn.com/2014/01/16/news/economy/norway-oil.pr.fortune/
(current asset of Norway's Government Pension Fund Global, widely known as the oil fund, is “around $830 billion”--not a trillion as the title says)

My comment:
(a) Read the first three paragraphs supplied by the URL above.
(b) The only other paragraph one needs to take away from this article is as  follows: “One thing is certain: Norway’s trillion-dollar problem isn’t going away anytime soon: Norway has proven reserves of about 5.32 billion barrels of oil and about 70.9 trillion cubic feet of natural gas, ensuring a continued flow of revenue into the oil fund for decades to come.”
(c)
(i) list of countries by proven oil reserves
en.wikipedia.org/wiki/List_of_countries_by_proven_oil_reserves
(read cautions in section 1 Methodology)
(A) unit: MMbbl [million barrels; Latin mille "thousand;" M = thousand, MM = million)

ranking……….countries………..MMbbl
12……………….China……………...25,585
14……………...United States...23,267 [footnote 4: “US Energy Information Administration, International energy statistics, (proved reserves as of 2011)”]
22……………...Norway…………...6,900
94……………...Taiwan…………………...2
95……………….Israel……………………..2

I am surprised that Taiwan has oil reserve, but have no idea where it is (in the seas?).
(B) oil reserves
en.wikipedia.org/wiki/Oil_reserves

section 4 Estimated reserves by country: Proven Reserve Data as of 2012 (source: OPEC)
countries………...Reserve/Production Ratio (Years)
Russia….………...22
China……………...14
United States….10

* Norway is not among the top 17 (in this section).
* Looking back, the figure for US, as well as the world, might be be correct, which triggered Peak Oil (the end of the oil age) alarm. However, franking has changed all that (at least in US).