The third of three Company Snapshots, these research-based pieces by guest author Jessica Guo look at aspects of successful companies that can be examined for strategy and information of benefit to both active businesses and the academics that study them. See our first company snapshot examining culture and values at Costco and our second company snapshot looking at how values around sustainability and responsibility drive culture and integrity at Patagonia.
Company Snapshot: Conscious Capitalism- Core to The Container Store’s Success
According to a 2012 study by the global management consulting firm Hay Group, retail stores typically see turnover of 67% in part-time employees. Yet the Container Store, a leading storage and organizational products retailer, boasts an annual store employee turnover rate of only 10%.
The Container Store’s employee satisfaction translates directly into bottom-line success: the company has grown from a founding $35,000 investment in 1978—about $131,000 in today’s currency—to earn over $800 million in net sales in FY 2017. “A good capitalist will see the value of what we’re doing,” co-founder Kip Tindell says. “We would not be as profitable if we did less for our employees and vendors.”
Putting Brand Values into Practice
Tindell and fellow co-founder Garrett Boone describe The Container Store as a Conscious Capitalist company, referencing a growing trend among companies towards values-based businesses where good ethics is good business. The trend popularizes stakeholder theory principles, formalized by R. Edward Freeman, which argue that businesses should create value for stakeholders as opposed to simply financial shareholders in order to also benefit employees, communities, suppliers, and other actors who are affected by the business.
An example of The Container Store’s values in practice is the company’s trademarked Foundation Principles, which Tindell developed in 1988 after opening their seventh store, in Houston, and realizing they needed to clarify the company’s values. Today, these principles are an integral part of the company’s identity. They are printed on shopping bags and T-shirts. Conference rooms at the company’s headquarters are named after them. The seven values are:
- 1 Great Person = 3 Good People.
- Communication IS Leadership.
- Fill the other guy’s basket to the brim.
- The Best Selection, Service, & Price.
- Intuition does not come to an unprepared mind.
- Man in the Desert Selling.
- Air of Excitement!
Jessica Guo graduated from NYU Stern (BS ’17) with concentrations in Finance and Global Business and a minor in Social Entrepreneurship. Her interests lie at the intersection of business and social impact, stemming from her belief that business can be a key force for positive and sustainable change. See our first company snapshot examining culture and values at Costco and our second company snapshot looking at how values around sustainability and responsibility drive culture and integrity at Patagonia.