Trader Joe's Case

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Trader Joe’s is an up and rising supermarket that is upbeat and even has employees wear Hawaiian shirt. This gives it a more relaxed and enjoyable shopping environment. The company selects small stores and only keeps about 4000 stock-keeping units. Eighty percent of those units contain the Trader Joe’s brand. This initiates a quick turnover over rate. Trader Joe’s usual customers are college educated people living in urban areas and also college kids. The company makes it easier for these customers to buy different variety of items buy not having too much diversity that would cause shopping paralysis. With lower variety, Trader Joe’s can control quality much more effectively then it would with more options. Their product line has similar popular products that other supermarkets have but it is under the Trader Joe’s brand. The company also looks to find new interesting foods that I can add to the supermarket rather than following trends it tries to set the trends. It has options from basic organic fruits to exotic food like Belgian butter waffle cookies. When it comes to distribution; Trader Joe’s purchases directly from the manufacturers and then ships the products right to Trader Joe’s distribution centers.

Trader Joes doesn’t charge its suppliers for advertising, couponing or slotting shelves. In exchange for this benefit, Trader Joe’s has asked suppliers to operate with Trader Joe’s in secrecy. The vendors cannot publicize the business relationship with Trader Joe’s in any matter. This strategy is to help prevent both consumers and competitors from gaining knowledge as to who produces the food that the store sells. Suppliers also do not like having the idea that that one store offers a lower cost version and not at the other.

The pay offered at Trader Joe’s is also generous which helps produce a more enthusiastic crowd of employees. The company also contributes 15.4% of an employee’s Gross income towards a tax deferred retirement fund. Many workers...
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