When Ron Vachris started as a forklift operator for Costco's predecessor in 1982, he probably didn't expect to be running the company four decades later.
Back then, at age 18, he was probably making a little over $3 an hour, moving pallets around a new breed of store—huge warehouses loaded to the rafters with laundry detergent, cereal boxes, and toilet paper.
After Christmas, the 58-year-old will oversee 300,000 employees in nearly 900 of Costco's massive warehouses.
For this he will take home $11.5 million next year – and if he wants, he can choose which brands of detergent they have in their range.
Costco has only had two CEOs in its 40-year history, and when Vachris takes the helm in January, he will be the third.
Ron Vachris, 58, will become Costco's third CEO on Jan. 1 when his current boss, Craig Jelinek, 71, steps down
A man operates a forklift at a Costco warehouse in San Diego, California, in July 2007. When Vachris operated a forklift at a Price Club warehouse in Arizona in 1982, he would have been 18 years old
His retail career began in Arizona in 1982. While studying business at Glendale Community College, he worked as a forklift operator at Price Club – the first major members-only wholesale retailer, which merged with Costco in 1993.
In 1991, he was general manager of a store in Denver, Colorado, according to the Crunchbase corporate database.
Over the next 20 years, he continued to hold various management positions in the warehouses and in 2010 began managing Costco stores in the Northwest.
In 2015, he became senior vice president, working first in real estate and then in merchandising.
Seven years later, in 2022, he emerged as the heir to the throne after being named President and Chief Operating Officer (COO).
Now at the helm of the $280 billion company, he will earn a base salary of $1.15 million and receive $10.4 million in Costco stock, according to SEC filings.
Costco has a long history of promoting employees into leadership positions.
Its second and current CEO, Craig Jelinek, 71, started at the bottom as a grocer for another Costco predecessor, FedMart, founded by the wholesale tycoon behind Price Club, Sol Price.
At FedMart, Jelinek met and worked with Jim Sinegal, who founded Costco in 1983 and became its first CEO. Shortly thereafter, Jelinek joined Costco and when Sinegal retired in 2012, he became Costco's second CEO.
Pictured is a forklift operator at a Price Club in 1992, nine years after Vachris started working for the company and a year before Costco took over
Pictured is a Price Club warehouse in San Diego in the 1980s. Vachris began his career in 1982 as a forklift operator in a warehouse in Arizona
Ron Vachris (left), 58, is pictured with a Costco employee at a warehouse in Indiana
Under Jelinek's leadership, Costco's revenue more than doubled from $99 billion in 2012 to $242 billion in fiscal 2023.
After stepping down at the end of the year, Jelinek will remain in office in an advisory role until April. He will then continue to serve on the company's board of directors.
Vachris and Sinegal have worked hand in hand for the past twenty-one months [Vachris’] “I have served as president for many years before,” the company wrote in a press release announcing the appointment in October.
“Costco has a very strong culture and a deep pool of management talent,” Jelinek said. “I have full confidence in Ron and believe we as a company are fortunate to have an executive of his caliber as his successor.”
Costco executives face important decisions as U.S. retailers increasingly face problems with their business models. The Covid pandemic has taught consumers to spend money online and it has been difficult to lure them back into stores.
Meanwhile, investors are eagerly waiting for the publicly traded company to finally increase its annual membership fees to between $60 and $120 a year, which would boost revenue.
Chief Financial Officer Richard Galanti said on the recent conference call that it was “a question of when, not if.”