so the book that I want to talk to you about today is Sam Walton the inside story of America's richest man and is written by Vance Trimble this book is way less known than Sam's incredible autobiography in fact this book came out a few years before Sam's autobiography
is published at the end of the book Sam Walton is still alive and what is fascinating is how the book begins and it talks about the fact that before the early 80s there was no such thing as the forbs 400 list and so when the very first Forbes 400 list comes out Sam is on it and then within a few years he
obtains the number one spot and just holds it year after year after year but before that happened for the first 60 years of Sam wen's life he was not nationally known he it says he was in the shadows he was off the Beaten Track just building his incredible business Empire and so by the time the fors 400
list has come around Sam has already built this $6.3 billion fortune and so the book opens with all of these reporters in the early 1980s descending on Bonville Arkansas to try to figure out who Sam Walton is and how he accumulated such a massive fortune and then in their research they give a great
overview of his life and so it says he grew up in Missouri in the depression he worked his way through college lived a clean Christian Life served Stateside in World War II married an Oklahoma Banker's daughter opened up his first five in Dime Store in Backwater North
Central Arkansas and raised four healthy kids and then this is my favorite part of this entire section pretty darn ordinary but only on the surface Sam Walton underneath was no ordinary man he was a genius in business with an iron mind and unwilling to compromise any of his carefully thought out
principles and one of the most remarkable things about Sam is just how simple his idea really was and he says it's a a very simple idea I'm going to buy cheap I'm going to sell low I'm going to do that every day and I'm going to do it with a smile and focus on service and one of the benefits that Sam
Walton had early in his career was that there's a tendency for people to confuse a simple idea with an ordinary person and Charlie Munger who extensively studied Sam Hit Upon why an a simple idea taken very seriously is so powerful in business Charlie said in business we often find
that the winning system goes almost ridiculously far in maximizing and are minimizing one or few variables and so most of what I want to talk to you about today is just how long it took Sam to find his path and how messy it was at the beginning of you know one of the greatest businesses that has ever been
created I I read uh a little while ago that if you take his family's net worth today it's it's almost a quarter of a trillion dollars and yet it took Sam Walton 20 years of experimenting inside of retailing before he thrushes about that's the word he uses and finds the
idea slowly but surely through trial and error finds the idea that turns into Walmart but before I get there I just want to point out a few things that happened in his childhood that I think gives you an idea of the kind of person that we're dealing with there's a few traits that appear in his early life
that he never lets go of a sense of Duty he's extremely disciplined and then he had unbelievable levels of endurance and so this is a description of Sam when he was in high school Sam was going out for football and basketball learning to play tennis making A's and Friends grinding
away on merit badges in hopes of becoming an eagle scout regularly attending Sunday school and working odd jobs such as mowing the grass and delivering newspapers he was following the example of his dad his dad had a life motto that could not be more simple it is only three words and it's the same
word over and over again work work work his dad taught his sons that you were supposed to have a fierce work ethic he would not tolerate any of his sons not being industrious they had to be industrious they had to be ambitious and they had to be decent people and so
here's a little more about Sam in high school and it goes back to this idea that do not confuse a simple idea with an ordinary person he was quarterback of the undefeated football team he lettered in basketball he was president of the student body he was awarded the superlative the most versatile boy he
was in every club and organization and he was active the description continues he was a hard worker he was optimistic he felt that the world was something that he could conquer he didn't waste time he was always busy doing something and that's something that he's going to
continue for his entire career the fact that he's always working he hated wasting time and he's intolerant of slowness and I don't think you can understand Sam Walton until you understand the effect that the Great Depression had on Sam he grew up in the Great Depression he was born in 1918 and
so he's old enough to see the effects the financial effects and it actually leads to his parents divorce which is obviously very rare at that time that time period and he talks a little bit about seeing his father struggle through this time he says my father quit the mortgage company and went into business
for himself in the real estate and insurance industry then came the depression dad's business went down the drain and so then his dad is moving the family around looking for opportunity and yet for the next 10 years this is the prime of his father's life they make no no economic progress they are
distinctly lower middle class right hovering around the poverty line and so Sam and his brother Bud get jobs to try to help out the family and there's a line in the book that I think is very important to understanding the kind of personality that Sam had and it said the
Depression was a big leveler of people Sam chose to rise above it he was determined to be a success and so when I was reading this section what immediately popped into my mind is one of my favorite ideas it comes from Paul Graham and he was asking what is the bitter predictor of company success
success in business is it determination or is it intelligence and Paul's answer to this is incredible he says it turns out it is much more important to be determined than smart if you imagine this hypothetical person that is 100 out of 100 for smart and 100 out of 100 for
determination and then you start taking away determination it doesn't take very long until you have this ineffectual but brilliant person whereas if you take someone who who is super determined and you take away smartness eventually you get to a guy who owns a lot of Taxi
medallions or a trash hauling business but is still Rich it is important to note it only takes one person on the founding team to be super determined and the reason I bring that up and the reason I think it's really important especially in this section is because okay we see he's got this Fierce work
ethic right he is determined to be a success he is not going to allow his family to hover over the poverty line think about how insane if you were mapping out this I was thinking about this this morning if you were mapping out the family tree and the trajectory the economic trajectory of the Walton
family before Sam Walton comes on the scene you would see middling success and then all of a sudden there's this one data point this generational inflection point where it just Skyrocket today that family present day a 100 years after Sam Walton was born you know they have
quarter of a trillion dollars $250 billion but a hundred years ago they were St in the poverty line the difference was one person this super determined person made that difference he changed the trajectory of his entire family for generations and so it starts with determination but in this
hypothetical situation it's not that we have to remove points for intelligence it took Sam to find where he can be intelligent what is the field that he can be the most intelligent if you have a list of the greatest retailers of all time Sam Walen has to be at the top of that list and the reason I recommend if
if you haven't read his autobiography get it immediately get the audio book get the paperback whatever you have to do and then if you've already read that book buy this book because you will see it took Decades of him applying his determination and then matching it with 100 of 100 intelligence in a specific
field and it's important to understand this was not planned out Sam had no idea he had one idea one idea of of what his future career could be when he was around College age he's like maybe I should be president of the United States that's another personality trait that he
has he's going to aim straight to the top he has to be I think he calls it being like the top of the Heap or the top of the pile he's just has this ruthless competitive drive as well but he did not have this dream to be a retailer when he was a boy he stumbled into it and so let's go there right now
he actually gets a job at JC Penney this is an extremely important turning point in his life and you're going to see a lot of the lessons that he's going to learn from JC peny he applies later on to Walmart and so let me just tell you like in case you don't know like this
shocked me cuz I knew what JC Penney was it was around when I was like kid I don't even know if they exist anymore but in 1940 right where we are in the story JC Penney has almost 1,600 stores and they're doing 300 million a year in revenue and the founder is still actively involved even though he's in
his 60s his name is John Cash Penney Sam is actually going to meet JN and get a Le lesson directly from him so Sam gets this job he's getting paid $85 a month remember that for this upcoming story about sharing incentives with store managers which I'll get to in one second
but the first idea I have to point out to you that Sam's going to use for Walmart is the fact that the company strength that JC Penney had built, 1600 stores avoiding big cities this is exactly what Sam's going to do for Walmart and he focused on small towns you're talking about towns of 2,000
people 6,000 people 8,000 people that's the first idea it's like oh maybe there's a lot of more business out in these small towns than we thought the second idea John JC of JC Penney is constantly in the stores he is traveling around in in the store is wanting to
know what's going on Sam does this his entire life and it is one of these store visits to the store that Sam is working in Sam's around 22 years old at the time that he gets this lesson from this wiser more successful retail Legend he's 65 years old says a customer came in and
bought something from Sam and while he wrapped it up for her JC Penney was observing the transaction closely I finished wrapping and tying the package and the lady left then Mr Penny came over boys he said I want to show you something and he took a box about the same size and went around it with paper
and let it overlap maybe a qu of an inch then he went around it with twine one time like this and one time like that and he tied it he said boys you know we don't make a dime out of the merchandise we sell we only make our profit out of the paper and string we save this idea
of watching your cost 24/7 of making sure you're ruthlessly efficient is an idea that Sam walon holds on to for the rest of his life there's a lot of things in Sam's autobiography that I absolutely love that he said and this is one of my favorite things that he said in the autobiography that I think relates to
the story that we're learning right now he says you can make a lot of different mistakes and still recover if you run an efficient operation or you can be brilliant and still go out of business if you're too inefficient so that is the second thing he learned from his time of
JC fet here is the third his direct manager this guy named Duncan he said he was a fantastic trainer he used to invite us to his house every Sunday to play pingpong and to eat and talk we talk about business of course you could learn a lot he was one of the managers who had a 20 5% bonus contract again
another idea Sam is directly going to steal at the very beginning of Walmart he sets up all his managers and gives him 25% of the profits of the store and remember I said that at this time Sam is making $85 a month his manager shows him the 25% bonus check it was for
$65,000 this is Sam's response he waved that around and that made us run faster and work harder Sam Walton's time working JC Penney and applying what he learned there would eventually put a few billion dollars into his own cash register so I want to get into where Sam buys his first store where he gets the
money from he is 27 years old he marries a woman from Oklahoma named Helen they both have this desire they're small town people so they're looking around where they're going to live and where they're going to live they're going to try to buy a Ben Franklin store so they're
called Ben Franklin 5 and dimes the way I would think about this now is like the mod day equivalent would be like the dollar store the reason they were called five and dimes because most of the things that you buy there are you know you can get for a nickel or a dime and so Sam and Helen are going around
looking for a small town where they can raise their kids and Sam could have his store this is the very beginning of his retail Empire Sam is 27 years old and so they stumble upon this little town in Arkansas called Newport there is a Ben Franklin franchise now keep in mind at
the very beginning for like 20 years of his life Sam Walton is a franchisee of a much larger company and we'll get there in a little bit but it's crazy he tried to give the idea for Walmart to to Ben Franklin to the big Corporation and they laughed them out of the room and so 27-year-old Sam finds the store the town
There's 4,000 people that live in Newport this a tiny tiny town he can buy the Ben Franklin franchise it it's going to cost him $25,000 he does not have $25,000 so his father-in-law is going to be very important in their lives which I'll get to later his father-in-law is
very successful is a lawyer a Rancher a banker and so he loans Sam Walton the $25,000 needed to buy the Ben Franklin franchise and at this time Sam's plan is very simple he's like well I'm just going to take the obsession with customer satisfaction that JC Penney had and I'm just going to apply it to my own
little Five and Dime Store and so he's trying to figure out ways to like drum up business and this is the first sign of something that Sam Sam's a strowman he's like very much like a PT Barnum he's got the Charisma of a southern preacher and so he's constantly experimenting with these less con
conventional ways to attract more customers into the store and you wouldn't believe how some of these like really simple ideas were so effective so he bought he spent a bunch of money on an ice cream machine people like what you what the hell are you doing like it's a crazy idea and he' put it out in
front of his store and on the weekends families and all the farmers and all the people in this rural area they would mob his ice cream uh his ice cream machine and then some of them would come into the store and then turn into customers and then he'd obsess over their customer
satisfaction so then he'd make sure they return and then if they return they're going to tell the people and so you know 5 and a half years from now when he loses this store it is by far the most successful I think he's tied for first in all the Ben Franklin franchises if
I'm not if I'm not mistaken so he's like oh the ice cream worked what else can I do then he buys a popcorn machine does the same thing puts out the popcorn same exact thing happens he's like oh there's different ways to draw attention to the store than just by saying hey you know
50% off or buy one get one free he's finding another way to attract customers and even if he only converts a small percentage of the people that buy ice cream the people buy popcorn it's still a great return on the investment for buying a popcorn machine and ice cream machine and that's something that Sam's
going to repeat he really felt one of his his best advantages was consistent Around the Clock customer satisfaction says the most important Discovery Sam Walton made in Newport was that there was a charm and satisfaction in retailing that he had not fully expected
he was crazy about selling and about satisfying customers so customer satisfaction satisfying customers repeated over and over again throughout the book the way I would think about this is that Sam's satisfying customers is Jeff bezos's obsess over customers it's the same exact idea you and I have
talked about this many times in the past if you read about the early days Amazon Jeff Bezos is going around handing out highlighted copies of Sam's autobiography for the early employees at Amazon the life and career of Sam Walton had a huge influence over how Jeff Bezos built Amazon in the early days and so
Sam Walton's Ben Franklin store was a smashing success and then we're going to see something that that happens over and over again that opportunity is a strange Beast it frequently appears after a loss he's running this thing for 5 and a half years he gets sales up to 225,000 a year
no other store in Newport was performing like this and that catches the eye of his landlord and so this I consider one of the most important decisions of his entire life because at 32 years old Sam Walton is going to lose everything and be forced to start over again and it is
because of an inexperienced kind of rookie mistake when he bought the store he didn't read the lease close enough and he didn't not have the option to renew and so Sam is meeting with his attorney and his attorney is telling him what's taking place it's no good I hope to God the next time you take over
release from somebody you check to make certain it contains a proper renewal Clause they're not going to let you keep the store the plain truth is they want to run the Ben Franklin in that building you've shown the whole town what a money maker can be his attorney watched the
color drain out of Sam's face it looks like you're finished the attorney said the lawyer this is one of my favorite parts of this entire book the lawyer saw Sam clenching and unclenching his fist staring at his hands and then he straightened right up no he said I'm not whipped I found Newport and I found the
store and I can find another good town and another Ben Franklin just wait and see and so think about that you're Sam Walton you're 32 years old you have wife several kids and you just spent 5 and a half years building up a store that was a phenomenal success and somebody took
it from you from your own mistake he wasn't Sam wasn't out there BL bling other people and I love his response there he's like I'm not you know I'm not whipped I'm not going to feel sorry for himself that's fine I made a mistake I won't make that mistake again which we'll get to in a minute and I'll build
up again from scratch and so this is when he finds Bentonville Arkansas because he's driving around he's looking again running the same PL book let me go to the small town let me try to buy a Ben Franklin franchise from somebody wants to sell he finds one in Bonville and he doesn't make the same mistake so
what he does is like okay I will buy this store from you it's too small so I also need to get the barber shop next door Sam insists on buying the building and then next door he's like well this store is too small we're not going to make any money I got to knock down this
wall and so he finds that the barber shop next door is actually not for sale and so he's like I will lease that but I need a 99-year lease you won't sell to me that's fine then I need a lease that that lives longer than I do now the lease the barber shop is owned by two
widows they say the first time he comes him they say no the second time he says they say no the third time they say no the fourth time time they say no the fifth time they say no the sixth time it took six tries and you'll see he does this exact same Playbook when he's recruiting people in some cases he will
recruit the same person and they'll tell him no for a decade this guy is Relentless but finally the sixth time they finally agree to this outrageous you know 99-year lease and at the same time he suffers a devastating personal tragedy his mom dies unexpectedly from cancer she was
just 52 years old she went in for an operation to remove some of the cancer and then a few days after the operation she passed away so think about this he's 32 years old right he used all he's married with with kids like I said earlier he used all of his money setting up the new store in Bonville okay he's
got no he's got no money so he's 32 wife kids no money your mom who you adore dies at 52 years old unexpectedly at the same time he still has to run his Newport store till the end of the year so he is commuting back and forth and even though the store is only 250 M apart it's like an 8 to 10 hour drive
because it's through these mountains and the reason I bring that all up together is because you know no money your mom dies dies you're stretch as thin as could be and yet it is this driving back and forth that leads to one of the most important ideas that he ever finds
because he starts to think what the heck like I'm if I can never if I cannot move ground faster right I will always be relegated just having having one store you already know by now Sam Walton's not the personality type to be like Oh I'm just going to run one store for the rest
of my life and so it's during these long drives to the mountain 8 hours 10 hours each way he's like I've got to figure out a way to cover faster ground and then he hears the buzz of an airplane overhead and the author does a great job of describing this I want to read this to you sometimes hardship can Enlighten
and Inspire this was the case for Sam Walton as he put in hours and hours of driving Ozark Mountain Roads in the winter of 19 50 but that same boredom and frustration triggered ideas that eventually brought him billions of dollars he was struck with the realization that if he was competent
enough to operate separate stores in Two Towns successfully why not three four or maybe even a dozen he could see the possibility of his own chain of five and dime stores one evening he heard the Drone of a small airplane overhead and a light flash in his brain so he goes down
to the local airport he's like maybe there's a faster way can I like Charter a plane and can somebody fly me be between Bentonville and Newport and say says for a reasonable fee he charted a pilot to take him to Bonville the 8-hour road trip strank to a 90-minute flight this gave Sam the answer he was looking
for without this his Walmart phenomenon never would have been able to see the light of day and so it's no surprise that the Bentonville store starts to do really well because Sam's paying attention every single thing and he's just has this idea now I guess I need to back up
he is all constantly until the IPO he is constant ly underfinanced and under capitalized he actually talks about that in his autobiography so I want to read from his autobiography again before I pick this story back up he says many of our best opportunities were created out
of necessity the things that we were forced to learn and do because we started out under underfinanced and under capitalized in these remote small communities it contributed mightily to the way we've grown as a company had we been capitalized or had we been the offshoot of a large corporation the way
I wanted to be that's what I referenced earlier we tried to give away the idea to Walmart and they said no we might never tried all these small little towns that we went into in the early days it turned out that the first big lesson we learned was that there was much much
more business out there in small town America than anybody including me had ever dreamed of so his idea at the very beginning this is the good thing like he had to prove the concept over you know many many years then once he knew it was working he can pour you know gasoline on
these promising Sparks but his idea first is like let's get one store up that store is profitable let's take the profits dump that into another store then get that store profitable then dump it into another store and so that is why the planes become so important these are not corporate Jets he's like flying
around there's a bunch of almost like very close calls you know Sam Walton was a kind of Reckless flyer but you know thank thankfully nothing happened in his 40 Years of flying but without these like small little seses and these little planes they could NE he could have never
gone and traveled to all these stores because that leads me to the next thing I want to talk to you about it's not just that you know what JC Penney was doing back in the day going to all of his 1600 stores same thing Sam would do when he has this chain of five and dimes
same thing Sam would do when he has this chain of Walmarts he did it for every single one of his competitors he visited more retail stores than anybody else in history he does this he actually he does it for the stores and in his autobiography says that he would also show up at the headquarter uh like the
the corporate headquarters without an appointment and he says if you just show up and you ask more often than not they would let you in and then he would ask him questions about price distribution and all this other stuff he's like it was another form of education and so
he's doing this in the 1950s he's going to like Oklahoma in Arkansas in all these little country towns and he says he studied how they did things he was ready to pounce on any successful little trick they had and would copy it and so when I got to the section of the book two things happened one I had like a big
smile on my face because I just think it's hilarious I love people that are truly dedicated to what they're doing and you know I always say one of my favorite maxims is actions Express priority you demonstrate to other people what's important to you not by what you say not by what you believe but what you
do actions Express priority and so you got SAM running around all over the South visiting every single store and so that just made me smile and laugh and I I love people like that the second thing that came to mind is because I've become friends with Mr Beast Mr Beast is like
the the biggest Creator on the internet biggest YouTuber he's got like a billion followers across all these platforms I actually flew to Mr Beast headquarters and spent seven hours with him uh his top team one of my friends is a major investor in uh Mr Beast companies as
well and I heard a story that just screams like this is something that Sam Walton would do and so Mr Beast comes back from doing he's like a 17-hour flight or something like that lands back into the United States needs to do another connecting flight to get back to like the remote area where his
headquarters is and instead of jumping on another flight he Maps out there's like a 500 mile distance between where he's at and where his home is and Mr Beast Chocolate Company Feasta bles has a massive deal with Walmart and so what he does instead of flying home he Maps out every single Walmart in like a 500
mile radius and decides hey I'm going to drive you know you could take a couple hour flight or you can do like a 15-hour drive I think this was over multiple days and he visited every single Walmart in between where he was and where he was going and so at every single store visit
he would find room for improvement and one of the funniest things I heard was when in some cases in the front of the store it'd be it looked like all the febles was sold out and then he'd pull up he's like well my system says that you have inventory so he would go to the
back of the store and he would find the the inventory in the back and he'd literally carry it to the front so he could get more sales like that is what Sam walon would do I just love that idea where you have this this crazy determined madman in the 1950s driving through all these little towns
inspecting every single retail store that he finds going to the headquarters dropping in on the CEO and a soter and just riddling them with questions and using them as a form of education and then you see 70 years later the same kind of determined individual doing something very similar I just love that
part so as Sam is expanding he's opening new stores I already told you earlier he literally lifts that idea from JC Penney he's like okay I can't be here but he knew that you had to have a single like single threaded leadership there has to be one person that is completely
responsible for the performance of the store when Sam was not there so that's when he says hey I'll give you 25% of all the profits and then here's a fascinating story for you this is what I love about biographies we have some of the smartest most reductive people that
ever live and the biographies their life stories are full of them making mistake after mistake after mistake and so as he's expanding he comes across this brand new phenomenon at this point in American history there is no such thing as the shopping center and so as he's looking for locations to expand he comes
across I think it's the second shopping center ever built in United States and he's just like oh my God this is this concept is genius and so he gets distracted he is already building a small but very successful Variety Store five and dime chain and he takes a detour from something that's already
working says I'm going to develop shopping centers I have a line for this what he's doing because I did this the other day I was on the phone with my friend Jared and was explaining about this other idea I had for another podcast and he like completely shut it down and he used the Blackjack analogy
he's like don't split tense Sam Walton split 10 I'll cut right to the punchline we lost our money and left town so he had like a 1 to twoyear detour where he took his eye off the thing that was working he got distracted he gave into distraction and it cost him the
opportunity to cost of his time and a bunch of his money so now he is back fully dedicated fully focused on expanding his burgeoning retail Empire I love Scrappy people I love relentlessly resourceful people I love people who don't take no for an answer and so Sam is always on the lookout for new
exciting merchandise that he can stock in his store at this time hula hoops is like is this like phenomenon spreading all across the country the main like manufacturers of hula hoops will not sell to these small little Merchants cuz he's tiny at this time and so Sam's like
okay cool uh you won't sell to us that's fine we're going to make our own so he start he realized like what is a Hulu it's like this little it's colored plastic pipe with just a connector at the end he's like we're just going to make our own so after the stores close him and a bunch of other people they get
together and they start making several thousand of these night so that's the first part of this High agency Relentless resourcefulness this is hilarious to me remember Sam does not have a lot of money he's under financed under capitalized for a long time all the way until Walmart goes public and
Walmart doesn't even exist yet and so they're making them at one central location but they have to distribute them throughout all the stores that they have right Sam didn't even have a truck so how's he going to do this he has a car you know what he does he sets up a johnboat a like 12T Little John booat
behind his car and loads the the johnboat with all the hula thousands of hula hoops that they spent the night making and then he drives it around to his stores and a car and using a johnboat as a trailer and the end result is this line the hula hoops are so popular that you couldn't keep them in
stock and so there's a combination of two ideas here they think are really important number one doing things that others were not doing lead to unexpected success and two goes back to that quote that I read from Sam's autobiography the fact that many of the best opportunities
were created out of necessity because we were so underfinanced we were so under capitalized we had no idea just how large these businesses can be built in what you know these towns these towns were ignored and so they arrived at this very valuable idea through trial and
error through just testing a bunch of things and so here's a description of one of the things they found out that the larger they made the store the more money they made the decisions were made for Walmart long before Walmart as a company was developed back in the Ben Franklin days we learned so much and so
they use one example of a store where they make a a a slightly bigger slightly larger Ben Franklin store and how much sales grew as a result of just having a larger store surprise them and so this store the example that they're using was in this little town called St Robert so
St Robert showed us how much volume was there if we went into much larger units in small communities and pushed the merchandise we became the first independent variety chain in the country to try large stores in small towns we were doing an amazing in amount of business in a 13,000 ft store which is totally out of
character for a town of just 2,000 people we found that we could do a million dollars in each Variety Store that was unheard of and so it is through this constant experimentation the fact that he is still relentlessly visiting every single retailer everywhere he's at that he discovers what is going to be
his life's work which is discounting the concept behind discounting at this time was very counterintuitive that you lower the price you lower the margin but you'll make more money cuz you sell more and all throughout his autobiography all throughout this book every single
interview that you'll see with Sam even though he didn't do a bunch of interviews he talks about the fact that you know I have no shame in admitting this like if I was I was searching for good ideas and if I found a good idea if I found a competitor that had a better
idea than I did I would just adopt he was always he didn't care of the origination source of the idea he just wanted the very best idea so he's like he says if they had something good we copied it and it is through this that he says I was totally fascinated by the idea of discounting and when he
discovers discounting in the 1960s he's blown away he winds up studying this guy named irn Chase who starts this company called an and hope they only had six stores but they're doing $250 million a year in sales so all throughout the early 1960s it says there was no discount store in existence between 1960
and 1962 that did not get a visit from Sam Walton and it is through this that he discover discovers that another person had studied an and hope too and they' studied it before him there's this guy named Harry Blair Cunningham he is the one that comes up with the concept for
Kmart and so Kmart was a dominant player way before Walmart and so Sam Walton is looking back on this he's saying what I'm about to read you in 1990 after he's already beaten kmar he says I've always had the greatest admiration for Harry Cunningham because when he threw that
business down that thing was 10 or 20 years ahead of its time and he did it better than anybody else what I did later was take pieces of it meaning take pieces of Kmart and make our Walmart as much like it as we could the difference was and this is the fascinating thing that happens over and over again is
Kmart took the discounting idea and they set it up set up shop in major cities Walmart looked at that it's like well why would we compete headon with somebody that's already doing that we'll take the discount idea and set up in tiny tiny little towns and so back to what Sam was saying at the start we were
so amateurish and so so far behind Kmart just ignored us they let us stay out there while we developed and learned our business if they had jumped on us I hate to think of that but we were protected by our Small Town Market it would have been Unthinkable for them to have tried
to put a competing store in a small town they gave us a 10-year period to grow and then he also brings up the fact that they got rich and successful and fat and lazy they were self-satisfied with what they had accomplished Sam Walton was never to the day he died was never like
that they were self-satisfied with what they had accomplished they thought they could roll over everybody and they woke up one day and found out that the world had changed and so now Sam knows he's like I cannot stay in the variety store business I cannot stay in this F and die business discounting is going to roll
over everything let's get ahead of this and this is where this is where he goes so keep in mind I I guess you should back up he's 43 years old when he's make trying to make this transition he's got 13 of these variety stores right these Ben Franklin franchises or franchises
over the last 11 years he's built 13 of these stores so he goes this is what I meant when he he goes and tries to give away the idea for Walmart he's going to go to the to the headquarters of Ben Franklin in Chicago and he's going to pitch this idea to them and this is the idea that turns out to be Walmart I'm
going to read this whole section to to you cuz it's so fascinating to me his proposal was audacious certainly unacceptable he suggested that the variety store franchisers leap into the front line of the booming discount business I think that kind of store will fit in the rural markets just as well in
the major Metropolitan markets Sam said you should franchise them and I will be your guinea pig imagine Sam Walton pitching you on the idea that of a brand new business that's growing like a weed that is clearly the future and he's like I will be your partner and operator and
you say no that's incredible the Ben Franklin Executives exchanged sour looks Sam went on you're going to have to cut your wholesale prices instead of making 20 to 25% profit off the merchandise that you sell to your retailers you're going to have to be satisfied with about
122% so almost half they blew up they blew up at Sam to these sophisticated and experienced businessmen in their tailored suits and Customs shoes in Chicago okay it looked like the tail was trying to Wag the Dog what was this Arkansas country fellow's experience with only a dozen or so stores compared
to their thousand outlets and nearly a century of retailing knowhow we have to pause here because this is such an important point you have to think about the incentives of the people that you're selling to Sam Walton is trying to sell to them so the greatest example that got
lodged in my brain many years ago no one is ever eager to fix a cash machine that isn't broken and the person that put that idea into my brain the fact that you have to think about the incentives of the people that you're selling to that no one is ever eager to fix a cash machine that isn't broken is in James
Dyson's autobiography he invents the world's first cyclonic vacuum cleaner that means his vacuum cleaner doesn't need bags so before that if you own a vacuum cleaner you're constantly having to buy more vacuum bags right what does James Dyson do the first person he tries
to go and sell his invention to is a company that is making 500 million a year selling vacuum bags it he's like oh they're going to see how Superior a cleaning machine that my vacuum is compared to theirs that is irrelevant you cannot sell a Bagus vacuum cleaner to people to make 500 million a year
selling vacuum bags you cannot sell the idea of discounting at a lower margin and saying hey sell me your stuff at 125% in selling instead of selling it to me at 25% how do you think they paid for those tailored suits and those custom shoes with that 25% margin and so they laugh him out of the
room and then there's a great story that is told in this book it's also told in Sam Walton's autobiography the very next day one of the Ben Franklin EX Ives goes and checks out he's like maybe I should go check out this new Kmart thing that this crazy Sam Walton fella is talking
about and here's a description of what happens he got a surprise Sam Walton was there ahead of him here he was 25 miles from our office and he was talking to a clerk he was writing in a little notebook and at one point he got down on his knees to look under the display cabinet I said Mr Walton what are you
doing and he said it's just part of the education process Don I'm still learning and so Sam talks about this time it's not like he thought discounting was the future right but he wasn't sure if he could like he was going to succeed at it he knew he could he was really good at
the Variety Store business but he decides I'm just going to experiment he's he's constantly experimenting and he talks about this the way he describes uh this point of his life he has a great term on he says I was threshing around for the right way to go it was uncertain but one thing that he knew is
that discounting does not work if you have a high cost structure Discounters must they must have low cost and there's like these all these IND indicators that Walmart might be more successful than their competitors early on is because even after they go public they have like
the lowest cost to sales ratio in the entire industry and so how dedicated was Sam to keeping cost low well Walmart is called that in part because fewer letters means cheaper signs on the outside of a store and so Sam and one of his Executives have this list of names
they're trying to figure out what what are we going to call this New Concept you know I have to go out on my own the Ben Franklin guys they don't want anything do this so I'm going to do it anyways which one of those do you think we should call it they studi the list for a few minutes and all were long
names each made up of three or four words and so his executive says well Sam you had me buying the letters to go up on our Ben Franklin stores and I know how much they cost and how much they cost to repair and how much to light these letters it's expensive to put that many words in a name and the shortest
name on the list was Walmart and so Jeff basil has this saying he says we know from our past experiences that big things start small the biggest Oak starts from an acorn if you want to do anything new you've got to be willing to let that Acorn grow into a little sapling and then into a
small tree and then maybe one day it'll be a big business on its own listen to the description of the very first Walmart the business that is going to generate for the Walton family quarter of a trillion dollars of wealth the first Walmart is in a small town and is
only 16,000 Square ft it is an immediate success success from the very first year what do they consider a success $700,000 in total sales which may seem like a small number but from that day from day one the store that F first Walmart store for the next 15 years has a consistent 30% growth in sales it made
a profit from the very beginning so then he opens the second one he invites this guy named David glass who is going to many years into the future is going to be become the CEO of Walmart Sam tried to recruit him really early in fact it takes him a decade to get David glass to
say yes so he invites David glass out to the second opening of uh the opening of the second Walmart and this is what David glass said David glass thought that Sam might have lost his marbles with all this Discount Store foolishness it would surprise him if this kind of store had any future it was the worst
retail store I had ever seen Sam had brought a couple of trucks of watermelons in and stacked them on the sidewalk he also had a donkey ride out in the parking lot it was 115 degrees and the Watermelons began to pop and then the donkey began to poop all over the sidewalk and the watermelon and the
donkey ran together all over the parking lot and got inside the store like so many people before him and since David glass was guilty of a snap judgment on this unorthodox merchandiser Named Sam Walton in fact there's a great description of you know Sam's personality and and part of his like
success is this like promotion ability there's this article in 1989 in Fortune Magazine I'm going to quote from and it says so how from there from this like CRA you know this this exploding watermelon donkey crap opening uh so how from there did Sam walon get to be
America's most admired retailer he wied it through sheer force of a complex personality as the donkey watermelon episode illustrates he's an old-fashioned promoter in the PT Barnum style but he's more than that he's a little bit Jimmy Stewart he's handsome he's got this all Chuck's charm he's
also a little bit Billy Graham this is what I meant Billy Graham is this famous preacher Sam Walton's very much an evangelist he's a little bit Billy Graham with a Charisma and a persuasiveness that Heartland folks find hard to resist and he's more than a bit
Henry Ford a business genius who sees how all parts of the economic puzzle relate to his business overlaying everything is that of an old yard rooster who is tough loves a good fight and protects his territory and so the mistake that glass made is the mistake that most people make they they don't
understand that small improvements every day over a long period of time what that compounding can generate the thing that I underestimated about Sam is that he has an overriding something in him that causes him to improve every day that's not difficult when you have something as
bad as he had back in Harrison this is the donkey in the watermelon store but sometimes you achieve success and say boy now I got it like I want it I can lay back a little and enjoy enjoy it Sam never did that he has never gotten to the point where he is comfortable with who he is or how we're doing and this is
probably my favorite description of Sam Walton in the book his tactics prompted people to describe him as a modern-day combination of Vince Lombardi who insisted on a solid execution of the basics and General Patton who said a good plan violently executed Now is better than a perfect plan next week and
so once he realizes Walmart is a winning formula he he starts to expand really rap but what you see is at the very beginning he's just got a B simple basic plan simple basic principles that he executes on so the first thing is he's obsessed I've already mentioned it once
just like there's principles for Amazon that could be distilled down to obsess over customers for Walmart it was just customer satisfaction he said the essential ingredient is of course customer satisfaction hardly a day passed when without Sam reminding an employee remember Walmart's golden rule
number one the customer is always right number two if the customer isn't right refer to rule number one and so what he means by customer satisfaction is always exceeding the expectations of the customer so let's say you buy a pair of shoes they don't fit you don't like them
whatever the case is you bring them back Sam would tell his stores not only should you cheerfully replace the shoes meaning you should be happy you should be smiling then you should throw in a pair of socks and stockings for the hassle he understood the value of a
satisfied customer that that customer is going to come back to Walmart not next week not just next week not just next month we habit humans are habitual they'll probably be shopping there for decade after decade as long as you don't upset them or let them down and then as far as expansion you know this is
pre-comp computers which we'll get to just the massive surprising investment that Walmart made in computers in the 1970s but before that he's like okay well I want to run a bunch he he had like this idea was like I need to make sure that all my stores are so close to the Distribution Center that my trucks
can deliver whatever you're missing that same day he essentially started with the distribution Center and then work backwards and he's like I don't want to expand outside of this distribution center if it takes my truck drivers longer than 5 or 6 hours to get to anyone store and so the first handful of
Walmarts were in this 300 mile radius of Bentonville Arkansas and that's really what it was his faith and this adherence to this small handful of principles that he refused to deviate from he talks about this later I had no vision of the scope of what I would start but I always
had confidence that as long as we did our work well and we were good to our customers there would be no limit to us and for this fact alone is why reading these biographies and these early company stories are so important because it talks about like how there's a lot of rough edges in these Walmart
stores the eth Walmart ever they put it in this old it used to be a Coca-Cola uh botling plant and so it still wasn't all the way converted and so you had like all these pipes sticking up out of the floor everywhere there was no air conditioning in that entire building so
what's the solution okay we don't have AC we can't put it in before we open we'll just get 28 window fans and then we'll take care of the AC problem later and there's a line that describes what this was like in the very early days of what's going to become a very valuable company it says it was still largely a
seat of the pants Instinct of Sam Walton that guided this Walmart expansion again at the beginning there's going to be a lot of rough edges and half working things and not a lot of process the way I think about the early days of Walmart is the exact way I think about the early
days of Disneyland with Walt Disney there's a great line in that book I just covered the history of Walt Disney if you haven't listened to it uh it's episode 347 how Walt Disney built his greatest creation which he considered his greatest creation to be Disneyland and one of the people working with Walt
was describing this time says you asked a question what was our process like I kind of laughed because process is an organized way of doing things I have to remind you during the Walt Disney period of Designing Disneyland we didn't have processes we just did the work process
came later all of those things all of these things had never been done before Walt just gathered up all these people who had never design a theme park or never designed a Disneyland so we're on the same boat at one time and we just have to figure out what to do and how to
do it on the fly as we go along and not even discuss plans timing or anything we just worked and W just walked around and made suggestions same exact idea as happening in the early days of Walmart and so now Sam realizes oh Walmart is the main thing this is where my entire focus
should be on and so this is where he really really wants to start putting he's really think about how long like he he did 5 and a half years with one store store in Newport right learning learning slowly proving that he knows what he's doing then he gets Ben Franklin another
Ben Franklin store then you know a handful I think in what 11 years he does 13 more stores watch how he is the weird thing I'm trying to describe to you is like he's simultaneously impatient and has an abundance of patience if that makes any sense so takes a while to make
sure he knows what he's doing it's actually going to work but once he knows it's going to work he puts his foot all the way on the gas pedal and so up until this point he's got one big problem he is eyeballs deep in debt it's like causing him anxiety stress he's been borrowing and financing the expansion of
Walmart's he he gets loans from Banks and Loans from insurance companies and he's dying for a permanent solution and he only has one idea for a permanent solution he's like we have to IPO we have to we have to tap the public markets and so he's going to meet these local AR Arkansas entrepreneurs they're
called the Steven Brothers they're going to team up with another Wall Street firm that that is successful in selling in the stock I'm going to get there in one second cuz it's kind of nuts at how spookily accurate a bunch of Sam Walton's predictions are but I just love
they give a short background in the book on the Steven brothers who you know are very helpful in getting this IPO done I'm going to skip over all that I just love the advice because they were like you know poor Arkansas boys too and they wind up being they they hit the for 400
list too for different reasons but I love the advice that their dad told them when they were grown up in like Royal Arkansas he says uh he used to tell his sons don't be ashamed of your poverty and don't be proud of it just get rid of it as quickly as you can and his uh Sons made good on that advice but I want to
talk about how nuts it is that Sam's he was just dead on on a lot of his sales growth so he's he's doing this pitch to potential investors and they're like okay your sales volume right now is around $20 million a year and Sam's like yes sir our business is really growing
this year we did 21 million 21.3 million that's quite a jump because the year before we only did 12.6 million and he says our calculation is that in the next 5 years our 5year projection from now that in 1975 our sales will be 230 million and so the the other side of the table is like decidedly skeptical like
this guy's a nuts and here's the punch line Sam Walton however was right on target total sales for 1975 came to $236 million so in 1969 when he was done with that he was at 21.3 he's like we're going to hit 230 million 5 years from now and he came in at 236 and then I want to point out a part
of Sam's personality this is also something he shares in common with Jeff Bezos he's very polite he has a Country Charm but he drives the way he pushes his top Executives he pushes them unbelievably hard it's really fascinating the difference the way he treats his like Frontline workers who he
spends a lot of time with pays attention to them makes them feel special makes sure they're doing their good job but like he doesn't push them like he pushes his top Executives and so it says Sam had seen others resign or get fired because of the rigors of working in a
pressure cooker for a boss that some Executives called that old slave driver that's that's that's his internal nickname there's a line from one of Jeff basos his biographies it's very similar it says if you're not good Jeff will chew you up and spit you out and if you are good he will jump on your back and
ride you into the ground so they both hold their top Executives to an unbelievable r rigorous standard of Excellence the way I think about Sam's affable Country Boy personality with what's really inside when I read uh biography on a young Bill Gates excellent book if you haven't read
it yet it's called hard drive the making of the Microsoft Empire covers the first 35 years of Bill Gates life you realize that a young Bill Gates was just gangas Khan in a Mr Rogers costume something similar is going on here with Sam says he also claims that the public conception of Sam as a good old country
boy wearing a soft velvet glove misses the fact that there's an iron fist within that glove the boss himself candidly agrees I guess I can get a little tough if I see things I don't like Sam stressed that he knew his business from top to bottom I used to do it all sweep the floor keep the books
buy the merchandise one of my assets is my willingness to try something new and to change that is a concept that we carry out throughout the company we have a low resistance to change we call it our RC factor and so there's many examples in the book of what I just referenced the fact that as hard as he
is on his his Executives as hard as he seems to be on his Executives he's just as supportive of his Frontline workers and genuinely cares about them there's a bunch of examples here's one he would flag down one of his own 18 wheelers and climb into the cab to ride 100 miles
with a driver to gain firsthand experience that might improve Walmart Transportation he would get up at 2:30 in the morning buy a box of donuts and take them over to his warehous to the warehouse loading dock where he solicited ideas to upgrade their effort if the docker said they needed two
additional shower stalls they immediately got them this is all connected to something that Sam Walton would repeat remember repetition is persuasive so he repeats over and over again throughout this book but also in internal Communications that he believed in management by walking around when Sam
discusses his management style he's dead serious about identifying it as mbwa management by walking around there's this company newsletter called Walmart world that would go out every month and it says this adherence this reference this repetition of the importance of
management by walking around at for Sam and for everybody in the company it rarely not appear in an in an issue think about how crazy that is every month he's just repeating the same thing the importance of this same thing over and over and over and over again these are all great ideas and smart things
that Sam Walton does let's get back to another mistake he winds up retiring he he recruits this guy named Ron Mayer Who he thought of like this boy genius and so I will read to you my note which gives an overview of what's about to take place here stepping aside of the
company you spent your whole life building because someone else is in a rush does not seem wise and so Sam is about to turn 57 and Ron Mayer is putting pressure on him saying hey you know I I don't want to just I want to run my whole company like I want to be CEO of Walmart and you know if I can't
do that here then I'll have to do it somewhere else and so it says as he approach his 57th birthday Sam Walton was reluctantly trying to change his lifestyle completely by surrendering the day-to-day command of his Walmart Empire now Sam is going to find this impossible to do and I'll describe Sally retired
and never retired it's the it's the weirdest thing and so he's having this conversation with his wife and his top Executives he says I'm going to lose Ron if I don't step aside and I don't want to lose him he's a very talented guy and so it was official Sam had retired Ron
was the new chairman and CEO of Walmart it is the most uncharacteristic Sam Walton kind of thing that Sam Walton never did so essentially he retires but he's still working his role was now supposed to be unofficial but he couldn't keep his hands off when he saw something anything he didn't think was
right he just Ste in and correct it on the spot that is the way I've always been I guess I was getting in the way of Ron's Authority and the problem is the numbers the sales and profits under Ron Mayer they're he's doing a magnificent job but Sam just has to control the
company it bothered Sam's conscious that he personally had made a mistake he discovered that he really wasn't ready to retire that he missed his old job and so he comes to this fork in the road he's like okay this obviously isn't working you either have to get back into it take back your job or you have to
leave completely and so when he tells Ron hey I'm coming back over I'd love to keep you of course Ron's going to do what most people would do he's like you know I can't accept that I'm not going to stand for demotion he winds up leaving the company so Sam takes back over control of the company he does
exactly he goes back to doing exactly what he's doing and that's that he's always recruiting now he he not only did he lose Ron mayor he lost a bunch of like Ron mayor's lieutenants so he lost you know a big chunk of his executive staff so he's got to go back and recruit
and he does what he does over and over again he would pitch the same person over and over and over again says someone said Sam Walton used up men the way he threw wood into his fir place just like the logs they blazed up with a fury generated powerful and beautifully efficient flames and after a Time died
down into cold ashes it was necessary for him always to be looking for good men and talent to replenish his stockpile he fell back on Old Habits and started to recruit again those who had scornfully turned him down before one of these people was going to be David glass
the eventual CEO 10 12 maybe 15 years into the future where we're in the story he's going to become CEO and rather successful CEO of Walmart and David didn't go into this job you know ignorant or blindly he knew he says he was under no M misconceptions he could expect to work harder and put in more
hours than ever before in his life and now we get to one of the most mind-blowing things that happens in the book at least mind-blowing to me remember he he was talking about the fact that he's he's not resistant to change now he has his principles he's not going to deviate from but he always
wants the best ideas and he repeats over and over again you know he says RC is that formula resistance to chain like we want a low resistance to change we're willing to change it's a trademark of like the Walmart culture the Walmart philosophy every day is a different situation in the retail business we have
to be flexible these are things that that Sam Walton would repeat now this in this is insane what they do here the the size of the investment so at first you know this is 1979 okay at first his team is top Executives people you trust they're like we need computers we need
help the business is like it's too unwieldly we don't we need we need more organized data be able to make better decisions and at first Sam thought computers were just overhead but then he listened and he learned and he changed his mind and more importantly that and
he invested he put his money where his mouth was finally his lieutenants educated and convinced Sam and Walmart Walmart plucked down $500 million for a modern Communications computer system and when they say computers this time in history he like giant IBM Mainframe and so now all the Walmart stores the
warehouses and the distribution centers are able to communicate in real time by 1979 the stores and warehouses could communicate around the clock with headquarters so keep in mind inside of every single store there's at least 36 departments in each store and they're
all selling different things so this computer system is now telling them daily sales from not only every store but every single Department inside of every store they tell them what the bank deposit for that day is they would estimate sales figures they would flag reports on like hot selling items that
they may may need to either order more and deliver more to the stores you'd have up-to-date Warehouse inventory and it just goes on and on and on so Sam is writing the annual report of Walmart 1979 and he he summarizes this perfectly he says the financial savings and the number of Personnel hours saved daily by
using the computer center are incalculable even by the computer so it's one thing to say yeah we're willing to change we want the best ideas Sam is 61 years old when he makes this decision 61 years old investing 500 million half a billion dollars in $1 1979 that's one of the most remarkable
things in the entire book and it just proves his dedication like I want he talked about investing in technology is a huge uh Advantage he had over other Discounters too but he's putting his money and his actions behind this where his mouth is when he when he said you know he was saying with his mouth no we
have a low resistance to change we want the best ideas and then it's one thing to say that's a completely different thing to match up his actions in this half a billion dollar investment with that that's nuts to me another surprising thing that I don't think I remembered you know I've read
this book before I've read Sam Walton's autobiography twice I've reread my highlights and notes from those books I don't even know dozens of times and I had forgot so once he realized oh Walmart's the thing he he's like man this thing's growing too slowly and it's
hilarious because this is what he considers slow growth and I'll tell you how he fixes this so from 1974 to 1977 he goes from 78 Walmarts to 153 so let's call that double and he goes from annual sales of 167 million to 478 million and he's like this is too slow so what he does next is something I
had forgotten he actually accelerates store growth by acquiring entire retail chains and then converting them to Walmarts now that he's a public company now he's got access for the first time in his ever he's got access you know to way more resources he's not constrained
by money anymore and so he buys a chain of 16 uh discount stores converts them to Walmart uh then he buys another chain of 104 stores converts them to Walmart he's showing that he can Master both growth internally and by acquisition so there's just a few more ideas that I want to tell you about two
main ones but here's another interesting one that reference are the fact that Sam is constantly collecting information from the front lines hates people sitting in the office it's like you need to get in stores and you need to go all across the country but as Walmart grows
they have like this entire fleet of planes and so they they use their planes every single day to be on site where the work is actually happening but his friend's daughter has a bad experience at Walmart and she actually calls her dad who just happens to be with Sam at the time and it was fascinating and so
we're hearing the story says my daughter bought a pair of shorts uh for her father-in-law they turned out not to be the right size so she goes back and they didn't have the right size but the manager is refusing to give the money back and so she calls her dad from the store her dad just happens to be with
Sam Sam gets on the phone and he listens to the customer and her name is Sarah Bell and so he listens to Sarah Bell and he goes okay let me talk to the manager Sam talks to the manager then the manager suddenly gets really really nice and gives the money back and so later on
Sam's friend was apologizing oh sorry you know to disrupt you getting on the phone with my daughter and he goes no I'm glad that Sarah called that the what he learn on that phone call had been it it's been worth its weight in gold I told the manager that I wanted him to
bring that pair of shorts to our Saturday morning meeting I made him stand up and hold up those shorts then I asked him what is our motto and he said satisfaction guaranteed you know every once in a while you have to refresh their memory this constant flow of information from the front lines from
the people actually serving the customers from the customers themselves is something that Sam Walton definitely believed in here's another fascinating idea this one definitely surprised me and I think it's another example Sam coping good ideas I mentioned earlier that his father-in-law played a huge
role in his life you know having a successful businessman entrepreneur as as a father-in-law to to give advice to not only did he loan the first $25,000 for that first store but he saved them Untold amount of money in the way that he had him set up the estate planning
the Forbes 400 lists assume that Sam Walton owned all that Walmart stock turned out he had given it away years before it had any value and he got that idea from his father-in-law when and how and why he and Helen shared their business Resources with their four children is one of the more fascinating
Untold Walton Stories the children have each owned 1th of their parents stock and property since 1954 Sam and Helen created the trust that set this up when Ron was 10 and Alice was only five doing this kind of estate planning so early in the game was urged on by Sam through his
father-in-law LS Robson who had earlier done precisely the same thing in giving Helen and her siblings equal shares in the vast Ranch that he assembled in Oklahoma Mr Robson was a banker and a lawyer and he was pretty smart Sam said I could see it was the thing to do and this all took place four decades ago and
so his son is talking about this at that time all dad and mother had was a variety store too our shares then couldn't have been worth more than $5,000 each at the time the book was printed which is in 1990 each of the kids were worth about $2 billion because of this so by turning
over ownership of 80% of his Holdings to his children so early on he avoided any substantial gift or inheritance taxes and so his father-in-law put it best the best way to reduce paying estate taxes is to give your assets away before they appreciate all right so let's talk about
speed and soul price this is one of my favorite stories of the entire book something that Sam Walton said over and over again that he took more ideas from Soul price than any single single other person think about how Relentless this guy was on studying everything everybody else was doing he's like this is the
person I learned the most from in fact I had a cool experience happened you might be mened this I read Soul Price's autobiography it's or not autobiography his biography was written after Soul price passed away by his son Robert price that is episode 304 in that episode I talk about how Soul price is
the most influential retailer of all time Sam Walton learned from him Jeff Bezos Jim Sagal the founder of Costco the founders of Home Depot the list goes on and on and on about how influential Soul price was anyways I put that episode out Robert Price Souls Price's
son the author of that book listened to the episode and emailed me he loved the episode and he thought it honored his father and his father should be honored if you haven't listened to the episode go back and listen to it and try to find that book it's incredible Soul price was
a remarkable man so let's talk about Soul price and speed look how fast Sam Walton is moving okay so he's got this idea he's got that that Walmart's already successful he's never we just heard somebody else say earlier he doesn't he never gets fat and happy with his success that never has never
happened didn't happen in the past and didn't happen up until the day he died and so he's always looking for you know I believe in Walmart and Discounters but there's always people coming with new ideas and he realizes that Soul price is going to invent an entire new category
and so it says on a January morning in 1983 Sam Walton flies to San Diego to investigate a new rinkle in the discount business a membership Wholesale Club what we think of as Costco and which obviously turns into Sam's Club as well the idea originated 5 years earlier by a Savvy California entrepreneur named Soul
price Soul price was making an astounding success by selling merchandise and only a 10% above manufacturers prices and getting rich if Soul price could do that Sam Walton figured he could too the Wholesale Club idea was good extremely good and so Sam goes back to Bentonville and he's like
okay we're just going to do the exact same thing that Soul price is doing out on San Diego and we're going to do we're going to call it Sam's Club and we're going to start right now this is insane first visit January 1983 okay January he does his first visit April the same year he opens the first
Sam's Club in the next eight months before the end of 1983 okay so January 1st he visits the first one doesn't have any by the end of that same calendar year he's got three then the next 12 months he opens eight more within 3 years of stepping foot in Soul prices Price Club Sam now has 23 Sam's Club
Wholesale stores and he's doing $776 million that's insane from nothing to almost a billion dollars in sales in 3 years and then within seven years he's got 105 of these things and they're doing 5 billion a year extreme patience coupled with extreme intolerance for
slowness that is the career of Sam Walton he's he's going to take a sign and make sure this thing works and when it works he pours gasoline on it and so it's this extreme bias for Action that runs throughout this entire book it's what Jeff basos says Jeff basos said that two of the things that he learned
most from Sam Walton's autobiography that he applied to the early days of Amazon is frugality and a bias of action and I think this extreme bias of action is a great place to close and will close in Sam's own words our method of success as I see it is action with a capital A
and A lot of hard work mixed in as we've said throughout the years do it try it fix it it's not a bad approach and it works there are a lot of people out there who have some great ideas but nothing in the world is cheaper than a good idea without any action behind it
and that is where I'll leave it if you have not yet read Sam Walton's autobiography I would read Sam Walton's autobiography first if you have a top 10 list of you know entrepreneur biographies autobiographies that Sam autobiography got to be in that list so if you haven't read that one yet I would
highly recommend doing that you can also listen to the episode I did on the last episode I did on Sam walen's autobiography is episode 234 if you've already listened to the podcast listen to it again and read the book then I would highly recommend getting this book as well Sam Walton is far too important
of an entrepreneur to only read one book about so if you buy this book using the link that's in the show notes in your podcast player also available at Founders podcast.com you'll be supporting the podcast at the same time that is 354 books down 1,000 to go and I'll talk to you again soon