Mr. Sol Price

1916 - 2009

Sol Price, a tough-minded businessman who pioneered the concept of warehouse superstores and later became a major philanthropist in San Diego, died yesterday at age 93.

Price was best known as the founder of Price Club, which he built into a chain of almost 100 stores before merging it into Costco. But long before that, he introduced his high-volume, low-price approach with Fed-Mart, a chain that Walmart founder Sam Walton cited as an inspiration.

From the opening of the first Fed-Mart in 1954, his strategy was consistent - sell goods as cheaply as possible.

"He saw himself as a trustee, a fiduciary of the customer," said his son, Robert Price. "Everything he did, he did it as if he were the customer."

Employees knew him as a tough boss who masked his generosity behind a cantankerous demeanor.

"He was a very dynamic, hard-driving individual with very high standards who expected people around him to have the same devotion to value that he had," said Price's one-time law partner, Paul Peterson.

At its peak, Price Club was S.D. County's largest public corporation, with 1992 net income of $134.1 million on $6.6 billion in revenue. Friends who kicked in $5,000 for a share of the business became millionaires many times over.

Price used his own wealth to benefit causes he believed in. His philanthropic work, ranging from a major development initiative in City Heights to helping start the Center for Public Interest Law at the University of San Diego, left behind a legacy of education and community improvement.

"He was always there to help those less fortunate," said longtime friend and business partner Murray Galinson. Price and his son Robert "adopted the community of City Heights" and helped make dramatic changes including getting funding for a library, starting school programs and investing in local projects, Galinson said.

Price was also long active in Democratic politics. He was an early backer of the late Gov. Edmund G. "Pat" Brown, as well as Brown's son Jerry, the former governor and current state attorney general. Democratic presidential candidates visited him, including then-Sen. Barack Obama in 2006.

Price, who was born Jan. 23, 1916, in New York, was the son of Jewish immigrants who came to the United States from Russia in the early years of the 20th century.

He moved to S.D. in 1929 and graduated from San Diego High School before earning undergraduate and law degrees from the University of Southern California.

Before he became a retailing entrepreneur, Price practiced law in S.D. for a number of years. Peterson, his former partner at the firm known today as Peterson & Price, remembered Price as the kind of person who was always generous to anyone who needed help.

"He was certainly a liberal, no question," Peterson said. "Liberal in the sense of caring about his fellow man. … He believed in helping people. He believed in improving humanity. That's a good word for him - humanitarian."

In 1954, some clients who were in the wholesale watch business persuaded Price to accompany them to a FEDCO, a discount house in Los Angeles that sold merchandise at extraordinary discounts to federal employees. Price learned that there were 5,000 FEDCO customers in S.D. County and spotted a market opportunity.

After raising $50,000 from investors, Price opened the first Fed-Mart on Main Street in southeastern S.D. It opened in December 1954, offering a rotisserie broiler for $21.95 and a 21-inch black-and-white television for $129.95, among other items.

As with FEDCO, membership was at first confined to government employees. But in the 1960s, after acquiring 13 stores in Calif., Ariz. and Texas, Price opened the stores to the public.

Walton, the Walmart founder, told Price he had walked into the Houston Fed-Mart in 1960 and decided it was the wave of the future. He said he didn't have the money to open a store in the big city, so he opened one in Bentonville, Ark.

"He (Walton) thanked me for making him America's richest man," Price later recalled.

Price might have remained at Fed-Mart had he not been dismissed by Hugo Mann, to whom he sold a majority interest in 1976. The dismissal, on the grounds of mismanagement, sparked a lawsuit that Price won in Superior Court in 1977.

After his ousting, he joined Robert Price in a new type of wholesale venture, initially envisioned as a warehouse operation where small businesses paid a fee to buy products at cut-rate prices. The first Price Club opened in a warehouse in 1976 on Morena Boulevard, selling only to licensed Calif. retailers and Mexican merchants who paid a $25 membership fee.

But there wasn't enough business, so Price offered memberships to consumers, starting with credit union members, federal employees and employees of large companies. As the business took off, Price Club offered everything from toilet paper to diamonds, expanding throughout the U.S. and into Canada and Mexico.

After the 1993 merger with Costco, which is still led by Price protégé and former Fed-Mart stocking clerk James Sinegal, Price stepped aside from active management. But he went on to start one of the first real estate investment trusts in Calif., the Price REIT, and continued his philanthropic activities.

"My father always needed a project," said Robert Price, who is chairman of Pricesmart, which operates warehouse stores in the Caribbean and Central America. "He was not a happy guy if he didn't have something to do."

The Price Family Charitable Fund that Price and his wife, Helen, established in 1995 has provided grants and support to many causes and groups, including the San Pasqual Academy for foster teens, San Diego Hospice and Scripps Mercy Hospital.

After the death of his 15-year-old grandson, Aaron Price, Price started the Aaron Price Fellows Program to provide high school students with an introduction to a variety of city, county and community institutions as well as trips to Sacramento and Washington, D.C.

Rep. Susan Davis, D-San Diego, former executive director of the program, said Price was an inspiration to many. "Sol was bigger than life with an intellect and a heart to match," she said.

Former city manager Jack McGrory, who is also a former Price executive, said Price approached philanthropy differently than most donors.

"He was incredibly smart and innovative both in business and charity. He found new ways of getting things done," McGrory said. "He was a tough, hard businessman, but he had a huge heart."

Friends and colleagues said Price had success in bringing change to City Heights, a multiethnic inner-city neighborhood of high crime and poverty rates.

He initiated the City Heights Educational Collaborative, a partnership between the San Diego Unified School District, San Diego State University, the San Diego Education Association and Price Charities.

Price, who put up more than $30 million for the project, made the enterprise possible, said SDSU President Stephen Weber. The project benefits City Heights and SDSU, Weber said.

"It gave us a teaching laboratory. We're dealing with the real problems of inner-city schools. The results have been remarkable, and we've gotten positive feedback from the community," Weber said.

Price's family said he had been in declining health the past two