Becoming Trader Joe: How I Did Business My Way & Still Beat the Big Guys
Reviewed by Chris Wendel
In the business book category there are plenty of authors who realize success quickly and immediately consider themselves sage experts. I prefer to hear from road-tested entrepreneurs that take years or even decades to hone their successful business models.
Which brings us to the recently released book: “Becoming Trader Joe, How I Did Business My Way & Still Beat the Big Guys” by Joe Coulombe. Most of us are familiar with Trader Joe’s, the 530-store grocery store chain that features healthy foods, helpful employees and a unique store environment.
Coulombe, who died in 2020, journaled his professional career before founding Trader Joe’s, during the chain’s successful run up until 1988 when he sold out and left. With detailed notes, Coulombe had the bones of the book manuscript. After his death, the manuscript was discovered, shored up by the talented writer Patty Civalleri and published in 2021.
The resulting book is a fascinating account of the calculated decisions that built Trader Joe’s into the grocery powerhouse it is today. Along the way, Coulombe navigated through complicated shifts in consumer demands and supply chains.
Coulombe’s ability to foresee changing market conditions is the hallmark of the success of Trader Joe’s. By looking at larger socioeconomic trends he predicted a growing market niche – highly educated consumers who sought out food and drink items outside of the homogenized grocery store offerings of the mid-1960s.
At this time, the post-World War II GI Bill produced a high number of college graduates, while jumbo aircraft allowed many Americans the opportunity to travel and discover different types of cultures and foods. The first Trader Joe’s store in Pasadena, California sought to offer broader food varieties that would attract customers that Coulombe described as “poor and highly educated.” He intentionally located the Pasadena store and concurrent markets close to college-educated customer bases.
Trader Joe’s stood out in several ways with this emerging market. Its product selections brought in new food and wines that were novel but now familiar to buyers. Its enlightened target audience would seek out and pay more for higher-quality items, such as almond butter and quality coffees.
The chain methodically grew as Coulombe and his loyal staff learned the nuances of profitable, high-demand products. The logistics of vetting and prioritizing inventory items makes up a significant part of the book.
Coulombe thought that a limited marketing budget could still drive sales with internal flyers that educated customers on new offerings. Most of Trader Joe’s early marketing efforts were directed at existing customers so they would remain in the fold, purchase more, and become evangelists as they also brought their friends to Trader Joe’s.
Perhaps the most important element of Trader Joe’s success was its commitment to its employees. From the beginning, Coulombe believed that higher wages paid for themselves with low turnover and employee loyalty. He also created a management system that allowed employees to have a say in system and product improvements. Since paying a living wage is currently a hot button topic, it’s interesting to look back at Trader Joe’s successful philosophy.
“Becoming Trader Joe” harkens back to a time of actually building a business, before the warped perception of success became defined by bro-culture millionaires, quick-climbing IPOs and internet unicorns. In contrast, we hear about success guided by bucking the dominant corporate model while prioritizing the value of customers and employees.
Like Paul Hawken’s groundbreaking 1988 book “Growing a Business,” Coulombe believes in building from vision and strategy while wisely correcting from mistakes along the way. For younger audiences, the book’s recount of events that occurred in the 1960s, ’70s, and ’80s may seem dated. These are minor sidebars that are worth grinding through to reach the gold in this essential handbook for scaling a business.
Chris Wendel works for Northern Initiatives, a mission-based lender located in Marquette, Michigan. Northern Initiatives provides money and know-how to businesses and organizations throughout Michigan and the United States. Wendel lives and works in Traverse City.