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

how we built a successful business on high wages.
Patty Civalleri • Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys
In 1962, Barbara Tuchman published The Guns of August, an account of the first ninety days of World War I. It’s the best book on management—and, especially, mismanagement—I’ve ever read. The most basic conclusion I drew from her book was that, if you adopt a reasonable strategy, as opposed to waiting for an optimum strategy, and stick with it,
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Each SKU would stand on its own two feet as a profit center. We would earn a gross profit on each SKU that was justified by the cost of handling that item. There would be no “loss leaders.”
Patty Civalleri • Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys
I took a cue from General Patton, who thought that the greatest danger was not that the enemy would learn his plans, but that his own troops would not.
Patty Civalleri • Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys
I liked semi-decayed neighborhoods, where the census tract income statistics looked terrible, but the mortgages were all paid-down, and the kids had left home. Housing and rental prices tend to be lower, and more suitable for those underpaid academics. Related to this, I was more interested in the number of households in a given area than the
... See morePatty Civalleri • Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys
To this day, the promotion of Extra Large AA eggs is one of the foundations of Trader Joe’s merchandising, not just because of the program per se, but because it set me to wondering whether there weren’t other discontinuities out there in the supplies of merchandise. Eight years later, we built Trader Joe’s on the principle of discontinuity.
Patty Civalleri • Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys
Trader Joe’s buying objective was to get just one, dead-net price, delivered to our distribution centers. This was quite similar to the policy that Sam Walton was developing at about the same time, a practice called “contract pricing.”
Patty Civalleri • Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys
Vendors should get prompt decisions. Some of our greatest coups were generated by our commitment to make an offer within twenty-four hours of a presentation.
Patty Civalleri • Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys
- It deliberately copied the physical layout of Consumer Reports: the 8.5” x 11” size,