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Business View Magazine
the way we merchandise, to the way we transport it, to
the way we handle it with the clubs. It’s always trying
to figure out ways to reduce your cost of handling mer-
chandise. If you can do that, then you can ultimately
reduce your selling price.” And reducing those selling
prices for the benefit of its members is a PriceSmart
imperative, just as it was for Sol Price when he began
the original Price Club back in the early 1970s.
“There’s a story that reflects the way Sol felt about
pricing merchandise and being a fiduciary for your
customers,” Naylon recounts. “One of our buyers got
a very good deal on a TV and was able to make a sig-
nificantly higher profit margin than normal. When he
went to tell Sol the good news he quickly found out Sol
wasn’t at all pleased, as the lower cost should have
been passed on to the customer. Sol’s whole point
was, ‘How low of a price can I sell something, not how
much money I can make on it.’ And that’s something
that is a foundation of how PriceSmart operates today.
It’s counter-intuitive to most retailers but it’s been a
key ingredient in the recipe for our success.”
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