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

by Joe Coulombe, Patty Civalleri (With)

Overview

Build an iconic shopping experience that your customers love—and a work environment that your employees love being a part of—using this blueprint from Trader Joe’s visionary founder, Joe Coulombe.

Infuse your organization with a distinct personality and culture that draws customers in a way that simply competing on price cannot.

Joe Coulombe founded what would become Trader Joe’s in the late 1960s and helped shape it into the beloved, quirky food chain it is today. Realizing early on that he could not compete and win by playing the same game his bigger competitors were playing, he decided to build a store for educated people of somewhat modest means. He brought in unusual products from around the world and promoted them in the Fearless Flyer, providing customers with background on how they were sourced and their nutritional value. He also gave the stores a tiki theme to reinforce the exotic trader ship concept with employees wearing Hawaiian shirts.

In this way, Joe laid down a blueprint for other business owners to follow to build their own unique shopping experience that customers love, and a work environment that employees love being a part of.

In Becoming Trader Joe, Joe shares the lessons he learned by challenging the status quo and rethinking the way a business operates. He shows readers of all types:

• How moving from a pure analytical approach to a more creative, problem-solving approach can drive innovation.
• How finding an affluent niche of passionate customers can be a better strategy than competing on price and volume.
• How questioning all aspects of the way you do business leads to powerful results.
• How to build a business around your values and identity.

Product Details

ISBN-13:	9781400225439
Publisher:	HarperCollins Leadership
Publication date:	06/22/2021
Pages:	288
Sales rank:	195,501
Product dimensions:	5.40(w) x 8.20(h) x 0.90(d)

About the Author

Joseph Hardin Coulombe was an American Entrepreneur. He founded the grocery store Trader Joe’s in 1967 and ran it until his retirement in 1988. Coulombe graduated from Stanford University in 1952 with a degree in Economics. He earned an MBA from the Stanford Graduate School of Business in 1954. Coulombe was a member of Alpha Kappa Lambda. Joe recently passed away on February 28, 2020.

Table of Contents

Foreword Leroy D. Watson ix

Preface: What's in a Name? xi

Coauthor's Note xv

A Trader Joe's Sampler

Before we get into the details, here are some Trader Joe's products that have especially interesting stories xvii

Section 1 How We Got There

1 The Milk Train Doesn't Stop Here Anymore

In 1965, I was forced by competitive pressures to convert a convenience store chain, Pronto Markets, into Trader Joe's 3

2 The God of Fair Beginnings

How I got started with Pronto Markets as a subsidiary of the giant Rexall Drug Co. in the 1950s 7

3 The Guns of August, the Wages of Success

I bought Pronto Markets in September 1962 and made the most important decision of my career: pay high wages 14

4 On the Road to Trader Joe's

Those high wages force me into merchandising moves, which led to Trader Joe's 24

5 How I Love Lucy Homogenized America

I smelled a chance to be different 28

6 Good Time Charley

Aloha! The first version of Trader Joe's, 1967, was the fun-leisure-party store 35

7 Uncorked!

How we managed to break price on wine despite the Fair Trade Laws 45

8 Whole Earth Harry

A serious recession forces me to marry the health food store to the party store, and I got Whole Earth religion in the process 60

9 Promise, Large Promise

Fearlessly advertising Trader Joe's 67

10 Hairballs 80

Section 2 Mac The Knife

11 Mac The Knife

End of Fair Trade on milk and alcohol in 1977 leads to the third and final version, which I called "Mac the Knife"*93

12 Intensive Buying

Honest, we love middlemen 100

13 Virtual Distribution

Outsourcing? So that's what you call it! 113

14 Private Label Products

Academic jokes for the overeducated and underpaid 125

15 From Discrete to Indiscretions

Standards are okay, up to a point 132

16 Too, Too Solid Stores

"Nymph, in thy orisons be all my sins remember'd!" 140

17 Skunks in the Office

Tom Peters runs amok in the organization chart 153

18 Double Entry Retailing

3-D tennis in the check stand 159

19 Demand Side Retailing

Geometry, Advantageous, but not necessarily true 163

20 Supply Side Retailing

Government Intrusion, a supply-side opportunity? 182

21 The Last Five Year Plans

Russia and Coulombe give up Five Year Plans in the same year, 1988 203

Section 3 First I Sell, Then I Leave

22 Employee Ownership

Founders yah, too bad. And that it led to … 211

23 The Sale of Trader Joe's

Money talks 217

24 Goodbye to All That

Auf Wiedersehen 228

Addendum

Post De-Partum

Or my ten years as a consultant 235

List of Companies 253

Index 254

Editorial Reviews

★ 07/05/2021

Trader Joe’s founder Coulombe details the company’s rise from a plucky grocery operation to industry heavyweight with legions of loyal customers in his inspiring and revealing debut. He largely focuses on the often-surprising decisions behind the company’s success, covering the company’s strategies for buying, advertising, distributing, and day-to-day operations since opening in 1967. Unconventional decisions about minor facets of the business paid big rewards, he demonstrates: in the 1980s, Coulombe used the enterprise’s increasingly powerful brand, for example, to popularize the previously little-known pilchard as a low-cost alternative to tuna. Coulombe shares his thoughts on his hiring process (and why he’s made it a point to hire people over 55) and his fondness for left-handed employees (they “see the world differently”), and details how he capitalized on such trends as the homogenization of American culture and the emergence of a well-educated, well-traveled consumer demographic. Coulombe also offers an excellent road map for success in life more generally, showing how determination and a willingness to try new things can save the day. Readers interested in the fascinating history behind a beloved brand—and entrepreneurs looking for guidance on how to think out of the box—need look no further. (June)

Publishers Weekly

2021-05-04
The founder of the popular grocery store chain delivers a memoir wrapped in a handbook for would-be entrepreneurs.

Coulombe (1930-2020) was a born wheeler-dealer, turning a 1958 partnership with Rexall Drugs in Los Angeles into a small grocery chain called Pronto Markets. The chain flourished for lack of competition, with market leader 7-Eleven effectively held back from the region until California laws changed and barriers to entry fell. Annual sales at Pronto and its successor, Trader Joe’s, “grew at a compound rate of 19 percent per year” from the founding until Coulombe left the company in 1988; he reckons sales and net worth growth to be about that today. Success in a business with historically tight margins came from an ability to pivot nimbly, drop products that didn’t work (including, in Southern California, bullets until the assassination of Robert Kennedy), and procure products wisely from suppliers with as few middlemen as possible. “The fundamental job of a retailer is to buy goods whole, cut them into pieces, and sell the pieces to the ultimate consumers,” he writes, going on to gloss each of those mandates. Unusually for the sector, Coulombe also offered high rates of pay, which kept turnover—a huge hidden cost—low. The author, who takes a gruffly scholarly approach to many business problems, keyed Trader Joe’s to demographic changes that recognized the anti–mass-market sentiments of the counterculture and the rise in international travel that led Americans to appreciate such things as high-quality coffee and wine. Any student of social trends, logistics, and supply chains will learn much from Coulombe’s pages and the stern dicta they contain, as, for example, when he offers this formula: “my preference is to have a few stores, as far apart as possible, and to make them as high-volume as possible.”

Sure to be required reading in business school—and for fans of Coulombe’s creation as well.

Kirkus Reviews