Monday, May 15, 2006

CarMax--"Best Company to Work For"

CarMax, Inc. (KMX-$32.66), is the nation's largest retailer of used cars and one of the Fortune 2006 "100 Best Companies to Work For.” Of the 11,500 (+) U.S. employees, 42% are classified as minorities and the voluntary turnover rate is 17% per annum. Employees can also buy any car left on the lot longer than 14 days for $200 over cost.

The 10Q Detective nominates CarMax as one of the “100 Best Companies to be on the Board of Directors For,” too.

The annual cash retainer was increased from $35,000 to $50,000 in the second quarter of fiscal 2006 for non-employee directors. Non-employee director compensation, including both cash and equity components, will average approximately $136,300 in FY 2006—all for no more than (on average) three weeks worth of “work.” Contrast that with CarMax employed buyers, who are responsible for obtaining CarMax’s used-car inventory through appraisals and by attending off-site auctions. Buyers earned (on average) $55,000 for their full-year employment (in 2004).

CarMax reimburses all directors for travel and other necessary business expenses incurred in the performance of their services to the company and extend coverage to them under the company’s health insurance policies. The Company also permits all directors to use the company’s corporate jet for personal travel; and the directors may also participate in the company’s vehicle discount purchase program that is available to all company associates.

The CarMax ‘Commitment to Diversity’ states: CarMax is committed to respecting the unique attributes of its Associates, customers and vendors. These attributes may include age, race, color, gender, disability, sexual orientation, religious affiliation, national origin, marital and citizenship status.

Consistent with this commitment, CarMax does not tolerate discrimination of any kind—except when it comes to compensation for corporate insiders.


Anonymous said...

How does that compare with other like companies directors and the quality of directors. They are the ones that are deciding who the next Prez will be, I don't think I would want anyting but the most experienced professionals as directors.

David J. Phillips said...

In our opinion--at most large-cap companies--you could install monkees in the Boardroom [of Directors]. Most Boards just rubberstamp managements' decisions.