Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

Still trying to maximize the use of a small store, I looked for other categories that met the Four Tests: high value per cubic inch, high rate of consumption; easily handled; and something in which we could be outstanding in terms of price or assortment.

The calculus of what do I risk if I sell included the fact that Trader Joe’s was my Zen window on the world. I experienced the world mostly through Trader Joe’s. That’s an advantage of being self-employed. That window can never be as open while you’re an employee, even a Frederick-Forsyth rich one, even one given great discretion by absentee owners

became intrigued by this and located the source of the pilchard: a packer in Peru. In June 1982, my wife, Alice, and I went to Lima to visit the canning plant. We witnessed something very interesting: the United States had a quota for imported tuna. Once Peru’s quota had been filled, a biological miracle occurred right there on the canning line. Wh

People often ask me, how many stores did we have at such-and-such a time? It’s the wrong question to ask. What’s important is dollar sales. For example, from 1980 to 1988, we increased the number of stores by 50 percent, but sales were up 340 percent.

We brought it to Los Angeles, had it bottled (Pilgrim Joe’s label), and we didn’t just break the price—we destroyed the price!

Lighting, I think, is one of the key elements in successful retailing.

David Ogilvy’s Confessions of an Advertising Man. The numbered paragraphs, the boxes drawn around the articles, are all Ogilvy’s ideas. I still think his books are the best on advertising that I’ve ever read and I recommend them.

I believe in ruthlessly dumping the dogs at whatever cost. Why? Because their real cost is in management energy. You always spend more time trying to make the dogs acceptable than in raising the okay stores into winners. And it’s in the dogs that you always have the most personnel problems.

One of my grand objectives in Five Year Plan ’77 was to eliminate all outsiders from our stores and to halt all direct store deliveries. This was one of the most radical features of Trader Joe’s, vis-a-vis the rest of the grocery industry.

Drucker wrote a seminal piece in the July 25, 1989, Wall Street Journal called “Sell the Mail Room.” Every executive should take it to heart.