Trader Joe's like Walmart?

Question

Is Trader Joe's like the Walmart of the natural food world in regards to keeping their prices low by using shady business practices with their suppliers? Like walmart will become the only supplier of a companies product and then will tell that company that if they want to keep their market they will now be selling the item to them at whatever price walmart names.

I am more interested in the way they treat the businesses that sell to them than what "facade" they may show to the public.

Answer 1

Great question. I'm a Trader Joe's junkie (I shop there at least 2x/week).

Because TJ is privately held, information is hard to come by, but there are 3 known indicators that reflect the business philosophies of this company.

1) Trader Joe's is generous with their employees. Unlike Wal-Mart they pay above-union wages and generous bonuses (1st-year supervisors average more than $40K/yr) and TJ's contributes an additional 15.4% of each worker's gross pay into a company-funded retirement plan.

2) Trader Joe's purchases directly from suppliers around the world. This knocks out the markups charged by middlemen and allows TJ's to pay fair prices to suppliers (also unlike Wal-Mart). They also pay cash to their suppliers.

3) In 2001, Trader Joe's voluntarily eliminated Genetically Engineered foods from its product offerings.

This appears to be a company that does well while doing good. Profits are important. They've figured out how to maximize profits while maintaining ethical business practices.

Answer 2

Only in the fact that both companies started out as small family businesses focused on the needs of their customers and mindful of their customer's budgets, and that they both provide a good, yet incomplete selection of grocery items that sources their products from many countries across the globe

Wal-Mart is a publicly-traded company that has been an industry leader in introducing technology to minimize costs in supply chain and inventory management, ever since the days it expanded past its rural beginnings. Their buyers focus on getting a very good price for a few select products in each category and offer these products for sale at prices much lower than many competing retailers. Some products that WalMart offers are not obtained and/or offered at a deep discount, but are nonetheless provided as a product choice for consumers that seek that item. Their introduction of the Discount Generic Drug pricing scheme for only $4 per prescription will save America from its health care expenditure ills, and as the number of drugs going onto generic increases, the value offered by WalMart will increase. I can't wait until WalMart comes to town (or another company that will provide prices like WalMart - especially for prescription drugs).

Trader Joes is a PRIVATELY-HELD CORPORATION. It started in upscale suburban neighborhoods of California (unlike rural Arkansas). Trader Joes focuses on a few product lines (wines, cheeses, coffee, dried fruits/nuts, desert assortments...) that became instantly popular with yuppies. Inasmuch as Trader Joes has expanded into fresh fruits/vegetables/breads, yes. Wal-Mart and Trader Joes HAVE BECOME MORE ALIKE:

They are offering consumers better choices.

Consumers no longer need to go to Safeway/Albertsons/Vons/Grocery Store to buy all of the food necessary to fill a well-balanced diet.

Answer 3

I don't think so. Trader Joe's isn't as eager to install one of their stores on every corner, and they only expand when they have the money and they seem to treat their employees very well. Any way, Whole Foods is a much bigger purveyor of natural foods. I hate walmart, btw

Answer 4

No, from what I've noticed, Trader Joe's isn't trying to undermine anyone else's business. Their items are reasonable priced, not bargain-bin priced.