TABLE OF CONTENTS

Page

I. Introduction………………………………………………………………………………………… 1

….…………………………………………………………………………………………………………………… 2

II. Background of the case of the study………………………………………………….. 3

….…………………………………………………………………………………………………………………… 4

III. Statement of the problem…………………………………………………………………… 5

IV. Objectives …………………………………………………………………………………………… 6

V. SWOT Analysis…………………………………………………………………………………….. 7

Strengths…………………………………………………………………………………… 8

Weaknesses………………………………………………………………………………. 9

Opportunities…………………………………………………………………………….. 10

Threats………………………………………………………………………………………. 11

VI. Alternative course of action……………………………………………………………….. 12

VII. Action Plan………………………………………………………………………………………….. 13

VIII. Conclusions…………………………………………………………………………………………. 14

IX. Recommendations………………………………………………………………………………. 15
 2 INSTITUTE OF TECHNOLOGY
WESTERN
COLLEGE OF BUSINESS AND ACCOUNTANCY

In Partial Fulfillment of the Requirements for the Course

BA 321 (Strategic Management)

TRADER JOE’S IN NEW YORK CITY

A Case Study

Submitted by

AARON DHALE L. JAEN BSBA 3 KARL EMMANUEL G. JUANGA BSBA 3

Submitted to

MS. MA. THERESA R. PINEDA, MBA

Professor
I. Introduction

A local business of convenience stores called Pronto Market in Los Angeles, California,
was acquired by Trader Joe Coulombe, the company's founder, in 1958. Joe Coulombe, a
Master's degree graduate from Stanford University, developed the Trader Joe's brand as a
grocery shop for "overeducated and impoverished individuals" Nine years later, he revised the
name of the company to Trader Joe's and built the first formal store in Pasadena, California.
There were just Nineteen outlets inside the network when Joe Coulombe retired in 1988. After
three decades and a number of owners, the company today has over 530 outlets spread
throughout 42 states (Pereira, 2022).
Trader Joe’s is currently owned by Aldi Nord, a part of the larger German family-owned
Aldi brand (not to be confused with Aldi Sud, a brother company that has an interesting
history with Aldi Nord). The company entered the ownership of Aldi Nord after Joe Coulombe
sold the company to Theo Albrecht, the CEO of Aldi Nord, in 1979 (Pereira, 2022).
The official stated mission of the business is to "provide our consumers the finest food
and beverages values consumers could discover anywhere and to offer them with the
necessary information to make better purchasing decisions," according to the company's
website. This purpose is also firmly supported by the corporate tagline "Your local grocery
store," which will provide a determination to the best quality of customer fulfillment provided
with a feeling of friendship, warmth, enjoyment, personal pleasure, and business pride
(Pereira, 2022).
Trader Joe’s is one of the most prominent grocery store in the United States. A grocery
store is a business that only offers customers food and drink items. The basic requirements of
a consumer for dry food, canned food, spices, fruits, and vegetables are intended to be
satisfied by it. In middle-class areas, where the only location for residents to buy food was the
corner store, the idea of the grocery store first emerged in the United States in the 1940s.
Customers would often give the owner of these vintage grocery stores a list of what they
wanted, and the store staff would pack the items and bring them to the customer. A range of
food and beverages are still available to customers in many basic grocery stores today,

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although they might not include more upscale options like vegan or gluten-free options
(Quain, 2018).

The case study approach was been utilize in crafting this paper. According to
McCombes (2022), a case study is an in-depth examination of a particular topic, like a
persons, community, location, occasion, business, or phenomena. While according to Crowe et
al. (2011), case study is a research approach that is employed to produce a thorough, diverse
knowledge of a complicated subject inside its actual work environment. It is an established
research method that is frequently utilized in a range of academic fields, in particular social
studies. In addition, according to Cherry (2022), a case study is a thorough examination of a
single individual, team, or incident. In a case study, almost every facet of the subject's life and
history is examined in order to look for trends and the root reasons of behavior. Case studies
have applications in a number of disciplines, including psychology, medicine, education,
anthropology, political science, and social work. To generalize, the goal of a case study is to
analyze and understand as much information about a specific person or group. Case studies
are also notoriously subjective, making it challenging to generalize findings to a larger
population.

2
II. Background of the case of the study

Trader Joe's is a privately held chain of grocery stores founded in 1958. The company is
based in Monrovia, California and operates over 500 stores in the United States. Trader Joe's
is known for its unique products, affordable prices, and friendly customer service. The
company has a strong following and a reputation for being a "neighborhood grocery store"
that focuses on providing a unique and enjoyable shopping experience for its customers. A
background study of Trader Joe's would likely include information about the company's
history, business model, competitive landscape, and growth strategy.
The background of the study of Trader Joe's begins with its founder, Joe Coulombe.
Coulombe opened the first Trader Joe's store in Pasadena, California in 1967. He was inspired
to start the store after noticing that many of his customers were looking for unique and exotic
products that were not available at traditional grocery stores. Coulombe saw an opportunity to
fill this gap in the market by offering a wide variety of unique products at affordable prices.
Over the years, Trader Joe's has grown to become one of the most popular grocery
store chains in the United States. The company has a loyal customer base that appreciates its
unique products and low prices. Despite its success, Trader Joe's has faced some challenges,
including increased competition from other grocery store chains and the changing retail
landscape. The study of Trader Joe's will explore the company's history, business model, and
strategies for success. It will also examine the challenges that the company has faced and the
steps it has taken to overcome them. Additionally, the study will look at the future of Trader
Joe's and the potential opportunities and challenges that the company may face in the future.
Joe Coulombe founded Trader Joe's in early 1967. Initially a convenience store, it
quickly changed to a more creative layout for ambitious food and drink buyers. TJ started
began with 17 locations inside the southern California region. Even as the number of
businesses grew to 26, more products were added at the beginning of the 1980s. They grew
to include northern California by 1988. A devoted client base that is still expanding nationally
has been produced by the merger of advanced designs and a provider culture. TJ now
operates over 270 locations across 22 states, generating in over $5 billion annually (Mallinger
&Rossy, 2007).

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 The Albrecht family, proprietors of a multi-billion dollars retail chain in the EU, bought
the company that Coulombe sold them in 1978. The business is nevertheless still private. The
Albrechts mainly passive investors; Joe maintained his position as CEO until his retirement in
1988. John Shields was appointed CEO, a post that was held until 2001, which brought
methods and processes to help the company grow. His experience includes retailing and
merchandising. The CEO at the moment is Dan Bane (Mallinger &Rossy, 2007).
TJ sells a variety of items that are different from what is found at conventional
supermarkets. By instead carrying national brands, they provide a wide range of food and
beverages as well as other health care options. Cheese, wine, ready-to-eat foods, frozen
foods, fruit, and ethnic options are among the products, and 75percent of them bear the TJ
mark. Most goods are available for affordable pricing which differentiates TJ from competitors
such as Whole Foods and Bristol Farms yet are regarded as being of a high caliber in terms
both of flavor and healthiness. TJ sells around five times fewer products than typical
supermarkets considering their stores are mainly in the 15,000 square foot area, and new
products are regularly added as older ones are taken out. TJ emphasizes continually shifting
product offerings to stimulate customers ’ preferences, which further enhances their
originality. People appreciate the sense of excitement that is created by the constant rotation
of unique food and beverage goods and look forward to discovering new products (Mallinger
&Rossy, 2007).

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III. Statement of the problem

This case study aims to understand the key factors that have contributed to Trader
Joe's success and identify strategies for maintaining its competitive advantage in the future.
Specifically, this would answer the following questions:

1. How can Trader Joe's continue to grow and maintain its competitive advantage in the
highly saturated retail grocery market?

2. How can Trader Joe's improve its online presence and keep up with the shift towards
online shopping?

3. How can Trader Joe's maintain its unique brand image and stand out from competitors?

4. What are the company's plans for future growth and expansion?

5. What is the problem with the current grocery store industry that Trader Joe's aims to
solve?

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IV. Objectives

In our Trader Joe's case study, we developed the following objectives in capable to:

1. Increase market share and reach a wider audience.

2. Expand the company's retail presence through the opening of new stores in strategic
locations.

3. Enhance brand reputation and position as a trusted source of healthy food options.

4. Increase digital presence and enhance customer engagement.

5. Increase brand awareness and expand the reach of advertising to a wider audience.

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V. SWOT Analysis

S W
1. Community oriented 1. Limited store locations

2. Quality product 2. Small store size

3. Store atmosphere 3. Limited product selection

4. Friendly and knowledgeable staff 4. Limited marketing and advertising

5. Low prices efforts

5. Limited online presence

O T
1. Expansion into new markets 1. Increasing competition

2. Developing an online ordering and 2. Economic downturns

delivery system 3. Rising labor costs

3. Private label products 4. Supply chain disruptions

4. Expansion of product offerings and 5. Changing consumer preferences

categories

5. Partnerships and collaborations

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 STRENGTHS

1. Community oriented
The store is known to support local community organizations and events and also
provide donations to local organizations.

2. Quality product
Trader Joe's has a reputation for carrying high-quality products that are carefully
selected and taste-tested by the store's buyers.

3. Store atmosphere
Trader Joe's has a unique and fun store atmosphere, which can make shopping more
enjoyable for customers. This can be very attractive to customers who are looking for an
enjoyable shopping experience.

4. Friendly and knowledgeable staff

Trader Joe's staff is known for being friendly, helpful, and knowledgeable about the
products they sell. This creates a positive shopping experience for customers, which can lead
to repeat business.

5. Low prices
Trader Joe's is able to keep prices low by using a no-frills approach to retailing, focusing
on store-brand products, and keeping overhead costs low.

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 WEAKNESSES

1. Limited store locations

Trader Joe's has a relatively limited number of store locations compared to other major
grocery store chains, which can make it difficult for customers who live in areas without a
Trader Joe's store to access the company's products.

2. Small store size

Some of the Trader Joe's store sizes are smaller which can make shopping more
difficult for customers and can lead to crowded conditions.

3. Limited product selection

Trader Joe's is known for its unique and exclusive products, some customers may find
that the selection is not as extensive as they would like. For example, the store may not carry
certain specialty items or products that are important to certain customers.

4. Limited marketing and advertising efforts

Trader Joe's does not have a large marketing and advertising budget, which means that
the company relies heavily on word-of-mouth recommendations. This can make it difficult for
the company to reach new customers.

5. Limited online presence

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 Trader Joe's has a limited online presence and does not offer online ordering or home
delivery services, which can be a disadvantage for customers who prefer to shop online.

OPPORTUNITIES

1. Expansion into new markets

Trader Joe's could expand into new markets by opening stores in areas where it
currently does not have a presence. This would allow the company to reach new customers
and increase its overall market share.

2. Developing an online ordering and delivery system

Developing an online ordering and delivery system could help Trader Joe's reach a
wider customer base and increase its revenue. This would allow customers who are unable to
visit the store in person to access the store's products.

3. Private label products

Trader Joe's could expand its private label product line to include more products, such
as organic and gluten-free options, to appeal to customers who are looking for these types of
products. This can increase the company's market share and revenue.

4. Expansion of product offerings and categories

Trader Joe's has the opportunity to expand its product offerings and categories to meet
changing customer preferences.

5. Partnerships and collaborations

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 Trader Joe's could form partnerships and collaborations with other companies to
expand its product offerings, such as with local farmers or producers to offer more locally
sourced products.
THREATS

1. Increasing competition
Trader Joe's faces increasing competition from other grocery store chains and online
retailers, which can make it more difficult for the company to attract and retain customers.

2. Economic downturns
Economic downturns can cause consumers to cut back on spending, which can
negatively impact Trader Joe's sales.

3. Rising labor costs

As minimum wage increases, labor costs for Trader Joe's may also increase, which can
negatively impact the company's profitability.

4. Supply chain disruptions

Disruptions in the supply chain due to factors such as natural disasters or political
instability can make it difficult for Trader Joe's to obtain the products it needs to stock its
stores.

5. Changing consumer preferences

Consumer preferences are constantly changing, and if Trader Joe's fails to adapt to
these changes, it could find itself losing market share to competitors.

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VI. Alternative course of action

1. Enhance the e-commerce and online presence. Develop a robust e-commerce platform
and increase investment in digital marketing to address the weakness of limited online
presence and e-commerce capabilities, Trader Joe's could enhance its online presence and
develop an e-commerce platform to allow customers to purchase products online and have
them delivered to their homes. This would make the company's products more accessible
to customers and increase revenue.

2. Expansion into new markets and regions. To take advantage of the opportunity for
expansion into new markets and regions, Trader Joe's could open new store locations in
areas where the company currently does not have a presence. This would increase the
company's customer base and revenue.

3. Increase in focus on health and wellness products. To take advantage of the opportunity
to increase its focus on health and wellness products, Trader Joe's could invest in
developing and promoting a wide range of health and wellness products. This would meet
the growing demand for these products and could attract new customers who are
interested in these products.

4. Developing a mobile app. To provide customers with a more convenient and smooth
shopping experience, Trader Joe's could develop a mobile app that allows customers to
create shopping lists, track their loyalty points, and also allows to track their orders and
delivery status.

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5. Branding and Advertising. To increase its reach and customer base, Trader Joe's could
invest in branding and advertising campaigns to promote its products and services. This
would increase brand awareness and attract new customers. This includes traditional
advertising methods such as social media marketing and influencer partnerships.

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VII. Action Plan

TIME FRAME ACTIONS OBJECTIVES

2020 - 2021 Enhance Customer Experience Introduce a new mobile app for easier
and faster checkout.

Implement online ordering and To expand reach and accessibility to

2021 - 2023 delivery options, and actively customers, making it easier for them
engage with customers through to shop and receive products from
social media. Trader Joe's.

Expand the company's store by To increase market share by opening

opening new locations in new new stores and expanding into new
and existing markets. markets.

Develop and launch new To Improve customer satisfaction by

2023 - 2024 products and private-label continuously innovating and improving
brands. product offerings and customer
service.

Improve supply chain To Differentiate the company from

management to maintain low other grocery retailers by highlighting
prices and high-quality products. its unique value proposition and
competitive advantage.

2024 - 2025 Introduce new and unique To increase sales through the
products introduction of new products and
improved customer experience.

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VIII. Conclusions

In conclusion, Trader Joe's is a successful grocery store chain known for its unique and
high-quality products. A case study on Trader Joe's may highlight the company's success in
building a strong brand identity and offering unique, affordable products. By introducing new
products, enhancing the customer experience, expanding its online presence, Trader Joe's can
continue to grow its business and maintain its position as a leader in the grocery industry.

Through careful planning and execution of these strategies, the company can achieve
its objectives and continue to provide high-quality products and services to its customers. The
conclusion may also suggest that the company should continue to focus on these strengths in
order to continue growing and staying competitive in the retail industry.

Trader Joe's could enhance its digital presence by developing a mobile app and improve
its advertising. The company could also consider opening stores in under served areas and
urban markets to expand its reach. By setting clear objectives and implementing a well-
structured action plan, Trader Joe's can maintain its competitive edge and continue to provide
its customers with an exceptional shopping experience.

To continue its growth and success, the company must focus on introducing new and
innovative products, and improving its online presence. Overall, a focus on continuous
improvement, customer satisfaction, and community involvement will be the key to the long-
term success of the companies.

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IX. Recommendations

Trader Joe's is known for its unique and affordable products, as well as its strong brand
identity. A case study on Trader Joe's may recommend focusing on these strengths in order to
continue growing the business.

1. Increase the focus on health and wellness products as consumers become more health-
conscious, there is a growing demand for health and wellness products. By offering a
wider range of these products and investing in marketing and advertising campaigns that
position the company as a trusted source for healthy food options, Trader Joe's can
increase its relevance and appeal to customers.

2. Enhance their digital presence by developing a mobile app that allows customers to easily
find products, create shopping lists, and order groceries for pick-up or delivery.

3. Invest in improving their supply chain to ensure that products are readily available in-store
and to improve the speed of delivery for online orders.

4. Focus on expanding their reach by opening stores in underserved areas and in urban
markets.

5. Expand the selection of unique and exclusive products, as well as investing in marketing
and advertising to build brand awareness.

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