Trader Joe's Secrets

Regular readers of this blog will be familiar with Trader Joe’s unexpected owners: a German discount-grocery chain. A new article in Fortune aims to reveal a few more Trader Joe’s secrets. Fortune interviewed various sources, although, in keeping with its reputation for secrecy, the company itself has “never participated in a major story about its business operations.” “What emerged is a picture of a business at a crossroads,” writes Beth Kowitt. “As the company expands into new markets and adds stores — analysts say the grocer could easily triple its size in the coming years — it must find a way to maintain its small-store vibe with customers.” [%comments]

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  1. Grubersauce says:

    I’ve been going to Trader Joe’s for roughly 5 years. One thing I have noticed is that its always the same employees working there.

    Not a bunch of teenagers who work the job for a few months and move on.

    I think seeing the familiar faces every time I shop there definitely contributes to the small-store vibe.

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  2. Seth says:

    The whole “owned by Germans” thing is a cover to keep people from finding out the real secret.

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  3. Elia Palmieri says:

    Maybe we could open a Trader Joe’s here!

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  4. Ed says:

    #1, your observation that the same employees work there is interesting and may be apropos. They may be following the same and much maligned (by “analysts”) approach that Costco uses: Pay your employees well, treat them well and you will have a stable, hard working group with little money-wasting turnover. The analysts are always yelling and screaming that Costco should cut cut cut wages like Wallmart to “save” money, but Costco realizes that what saves you in the short term often costs you in the long term. The stability of Trader Joes workforce may well be predicated on the same “pay and treat your employees well” approach, which in turn leads to a more stable and productive company in the long term.

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  5. Dave says:

    Trader Joe’s has been owned by the family trust that owns the Aldi chain, in Germany, for years; in CA, where Trader Joe’s is ubiquitous, this is a non-story. Trader Joe’s is non-unionized, pays its workers above-average wages, with benefits, and provides a path to promotion – this has all been reported before in various venues. Because they don’t buy from the big food conglomerates, and source much of their own food, they can charge much less for what Whole Foods and others charge exorbitant amounts. Cashiers also shelve and stock. Everyone does everything. Because of all this, their per square foot profit is among the highest, if not the highest, in the grocery industry. Needless to say, they have less employee turnover.

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  6. Melanie says:

    I love TJs and Aldi both, and both stores, although differing in target audience, certainly operate similarly. Yay for bargains!

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  7. Eric says:

    Seth: Obviously Tibetan Monks own the chain as a part of a far reaching plot to overthrow the Chinese government and take over India without any bloodshed.

    In all seriousness, parts of TJ’s business practices seem odd, I guess it makes sense but… shipping Indian food from India? And Thai from Thailand? The recipes don’t magically change depending on where one packages them.

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  8. popskoenig says:

    fter the 11/2010 elections you will probably see a long line of ex-pols extending out the door of T.Joe’s…all looking for employment there…give us those goofy teens anytime!!!

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