Wednesday, March 19, 2008

Costco cities

The Costco model is moving to cities.

Costco is the membership retail chain that is about the best by far at what it does. Anyone lucky enough to have one nearby knows that you pay an annual membership fee and then have access to great values. Granted many are just the same that you would have for free at WalMart or Best Buy, but there's much more. If you have a family of twelve(not required) you can get five pounds of Tilapia filets for $16.99, 18 red peppers for $7.99, 32 Dr. Peppers for $8.99, giant dill pickle jars big enough for a bar of New York sports fans $16.99, in other words if you want to buy in bulk, toilet paper, poland spring, paper towels, orange juice, etc... your membership is a bargain. Kirkland products, their label, are sensational in foods, like Kenmore appliances were and still are at Sears. But your Costco membership is checked at the door, at the check out counter, and at the exit. You must belong. And at that exit you can get a quarter pound kosher hot dog, mustard pickles kraut, and a 16oz Coke for $1.49. Can I belong to this club......

Could this concept be applied to cities. Seems to be the case.

In late January I spent some time in Lima, Peru. Arriving at the up to date airport I was in a familiar place, up to date, secure, organized. I met my driver, insisted upon by a friend because of the fear that I might be robbed, and we drove through a wild west scene for many miles(potholed roads, chaotic intersections, bars, neon signs galore, casinos, all kinds of girl clubs with the alluring signs, pawn shop type places, nightclubs and just an out of control but exciting atmosphere) before reaching the neighborhood of my hotel and near the hospital where my father was. That was relatively peaceful and orderly seeming area, like a U.S. city in some ways, except for the complete lack of people on the streets or in visible restaurants. That was my experience. Since returning, here's what I've learned---

The area that I staying in with the French owned Sofitel and the Clinica Anglo Americana where my father was staying is in a cordoned off zone where local Peruvians cannot go without permission. My wonderful waitress at my local diner, a Peruvian 20 years here and a U.S. citizen, said that she would not be allowed to go in that area if she were visiting. Apparently shopping malls, movie theaters, and entire areas of Lima are governed by identity cards, or membership cards, such that they are exclusive. Easy to justify at first, no Shining Path, radical Maoists, drug cartel terrorists, let the middle and upper class and visiting tourists have some sense of safety in a country with a less than reliable political system, but it was still a revelation. It was a Costco city, membership required. Safety was the benefit, the cost was unseen but...

Talking to my barber last week, he's from Uzbekistan, a Russian by nationality, from Tashkent, a great hair cutter and an opinionated guy who has been here for about 10 years, fled from his home country due to some sort of legal issues having to do with ethnic and class stuff, nice guy, fakes English well but hardly speaks it when you get to know him. He had some guests coming from Spain, Tashkent refugees like himself that went to high school with him, and he asked me where he should take them in New York City. I suggested a Greenwich Village to Soho to Little Italy to Chinatown walk, always a sure bet in my book for guests and even a joy for me. Eddie, my Uzbek barber, was repulsed by the idea. "They sell fish on the streets, it's dirty down there, it's too crowded on the sidewalks, how could I suggest that guests should go there?" His idea for New York---Disney should own parts of downtown New York and Coney Island in total and they should be theme parks with admission payments to clean places with entertainment, jugglers, magicians, bands and music, orderly "fun" places.

Costco is the coolest big box retail store that I know. Sorry for the comparison. I think that there is a concept here, however, that could be spreading and applied to much broader realms, spreading from the developing world and hopefully not to our world.


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