After a long time, Walter, the manager of the Seattle Costco headquarters store, greeted Jaesung and Jaeeun warmly and also exchanged pleasantries with mom.
“I heard you’re a computer genius; you even know Excel at such a young age.”
“Excel is truly the wizard of numbers. It’s a program with infinite possibilities.”
“It’s also a tiresome program.”
Sensitive to various numbers like inventory, sales volume, revenue, and purchases, Walter briefly recalled Excel, shivered, and steadied his distant mind.
“I know Excel too. I told my employees not to use those function things, but they kept using difficult features. Simple addition and subtraction would suffice; I don’t know why they use a cow-butcher knife to kill a chicken.”
“Huh? Jim’s here too? Aren’t you appearing too quietly?”
“It’s not my first or second time coming; is there a need to make a fuss?”
An old man listening to the conversation from behind Walter chimed in on the Excel topic.
Ron, spotting him, called the old man Jim, and Jaesung recognized him as Jim Sinegal, the chairman of Costco.
“So, what did this genius kid customer make?”
When Jim showed curiosity, Jaesung explained the program he had recently been making.
“I made an inventory management program based on Excel functions. If you input barcode information, inventory is automatically recorded by category, and it shows held stock, expiration dates, and necessary order quantities.”
“It sounds quite complex; you’ve made something impressive.”
Costco, expanding mainly in the Northwest to major cities, had already computerized most operations, and the functions Jaesung described were in a program they had made by spending a lot of money.
Considerable costs were incurred through outsourcing to create their own program, and recalling the expenditure, Jim Sinegal briefly made a bitter expression.
“I also made a tool to analyze future sales and trends based on that data. By comparing past sales with recent volumes, it can recommend quantities needed going forward and items customers want.”
With decades of mart experience, Jim knew seasonally and periodically high-selling items by intuition.
He could prepare appropriate inventory without a program telling him, but keeping up with constantly changing trends wasn’t easy.
Especially in Costco, which sold only a small number of high-quality items, discovering new items customers wanted required significant cost and effort.
Creating a program that just showed results using input data wasn’t hard, but upon hearing it analyzed data to recommend customer-desired items, Jim Sinegal showed brief interest but didn’t believe it.
“If what you say is true, you’ve made something amazing.”
“Jim. This kid recently sold a program he made himself to Microsoft for 2 million dollars. He might really have made such a program.”
Since Jaesung was such an unusual Asian middle schooler, Walter remembered details well.
When he said Jaesung might truly have made an outstanding program, Jim showed interest again.
“I don’t have sales data now, so I can’t show it, but if you give me past records, I can prove it.”
Jim Sinegal, Costco’s founder and CEO, naturally didn’t believe Jaesung’s words, but Ron, the forklift driver who had met him often, stepped in.
“James is a real genius. He knows our company better than I do. He said Costco’s core is selling a small variety of items with minimal margins, gaining customer trust even if sacrificing profit, to increase membership sales and secure funds. I don’t fully understand yet, but I’m starting to get it.”
“Hmm. You look like an elementary student still, but interested in management too. From your father?”
“My father is a professor at the University of Washington Medical School. I personally researched Costco because I’m interested. There’s more information on the internet than you think.”
As the conversation got serious, mom, who had gone to get necessary groceries, returned and said it was time to go home.
“It’s a shame to part like this. Would it be okay to discuss internally and contact you?”
“Yes. I wouldn’t have believed it myself. Come to our house; I’ll show you directly, so contact me.”
What Jaesung explained was too far-fetched to accept outright, yet somehow felt true, not to be ignored.
After pondering, Jim Sinegal told Walter Jelinek, the Seattle headquarters store manager, to investigate directly and write a report.
“Wow. This looks better than our company’s IT room.”
“In America, it seems popular to have workshops in garages. So I tried it too.”
Walter, visiting Jaesung’s garage, admired the several latest computers there. Actually, it was more comfortable working in his room, but with several workstations added, space became insufficient, so he moved to the spacious garage.
Moreover, after getting caught coding all night in his room, mom monitored by placing computers in the garage to prevent late work.
“I brought sales data from our stores over the past 5 years. This is internal confidential material, so don’t leak it to other companies.”
“I’ll delete it in front of you after the demo.”
Fortunately, he didn’t print the sales data clumsily; it was on a 5.25-inch floppy disk.
While transferring data to the server, Jaesung explained the program he made.
“Right now, data is manually input, but change settings, and the moment items are scanned with barcodes in stores, sales, incoming, returns, etc., item statuses will automatically record over the network.”
“We already use something like that.”
“Additionally, incoming dates and expiration dates are recorded, showing how long stock has been held and until when it should be sold.”
The program Costco currently used had a simple black screen with just items and numbers, but Jaesung’s, recalling future interfaces, was user-friendly and clean-looking.
“You can check monthly, daily sales data and rankings, and create desired graphs like bar or pie charts.”
He also linked it for easy ordering of sold items.
“I made it offline for now, but I’m working on web format management.”
“What do you mean by website?”
“Input ID and password, and you can use the functions anywhere connected to the internet, not just in stores.”
Currently using mailing floppy disks with saved data, he was amazed that with just a modem installed, sales and inventory could be checked anywhere.
“And recommending popular future items is actually forced. Need information on what items come out, can’t input everything. Instead, based on past data, more specific forecasts for needed quantities of same items are possible.”
Since computer performance struggled to keep up with the program era, all memory and computation were consumed just for this analysis.
Walter hadn’t expected such functions, but seeing Jaesung’s program, felt this alone was sufficiently impressive.
“It’s much more intuitive and easier to use than our current program. Easy to input, anyone could use it.”
Currently, IT specialists manually entered data for similar programs, taking long to output results, only checkable, not greatly helpful.
Jaesung’s was optimized for managing thousands of items and inventory; using it could drastically reduce input costs and time.
And decisively, being checkable anywhere with internet connection appealed most.
“Could you demo it at the company? Seems you’ll need to present before the chairman and executives.”
“If you prepare a computer and projector, yes. On an Intel CPU computer, not Apple.”
“What’s the name of this program?”
“Stockmaster Smith.”
A week later, Jaesung headed to Costco headquarters with mom, bringing a slightly improved Stockmaster Smith (the most common American surname).
Having done numerous investment pitches in his previous life, he explained the product without any tension to 1994 businessmen.
“It definitely looks better than our current program.”
“Since a child made it, anyone can use it easily. The current one is unnecessarily difficult.”
Jaesung boldly excluded prediction functions, citing need for high-spec computers, showing only basic sales and inventory management.
From Jaesung’s view, simple functions, but clean interface, intuitive features, fast processing impressed Chairman Jim Sinegal and executives.
“It might be rude, but did you really make this program yourself?”
“Walter, the store manager, confirmed directly. If doubtful, I can show the creation process and site at my house.”
“It looks good, but stability is a concern. Industrial programs must never have issues.”
“It’ll be more stable than your current product. If doubtful, get external verification.”
Many other questions poured in, but Jaesung neatly resolved doubts.
“We need to check stability, so first trial use in Seattle stores; if no issues, roll out to others.”
Chairman Jim Sinegal accepted using Jaesung’s program, contracting for 5 million dollars on condition of use in Seattle stores.
Since Jaesung was still a middle schooler, test in nearby stores, supplement issues, modify to fit Costco system.
If operating without problems in Seattle stores, additional 5 million dollars, install in all Costco stores.
Customizing to Costco required much work, but handling only about 4,000 items unlike other marts, customization was faster than thought.
“How did you think to make such a program?”
“I go to Costco often with parents, so naturally had these ideas.”
“What middle schooler goes to a mart and thinks to build an inventory management system?”
Jefferson Bezos, watching Costco people come and go while modifying the program together, sighed to Jaesung, saying he didn’t seem like a middle schooler.
He had taught programming, but at some point realized Jaesung’s skills surpassed his, and self-proud smart Jefferson thought kids these days are scary.
Two months passed quickly, and Costco, confirming excellence and stability of Jaesung’s program, paid additional 5 million dollars, installing in all stores.
Dad touched his forehead and sighed seeing Jaesung happy with investment funds back to 10 million dollars, but a San Francisco trip was already booked for next weekend.
Ding dong~!
“Is this Mr. Yoo’s house?”
“Yes, but who are you?”
“You’re Mr. James who made the management system. I’m Jim Wharton.”
A simple-looking white middle-aged man extended his hand to dad for a handshake.