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

by Patty Civalleri

The convenience store business is 90 percent real estate, 10 percent all other (merchandising, personnel, etc.).

But to execute a high-SKU assortment policy you almost have to adopt single bottle shipments. Our 1977 decision to cut back on SKUs made it possible for us to go with the full-case-only practice.

That same day, one of the most satisfying of my life, I dropped cigarettes. I didn’t want to be outstanding in cigarettes. The only way you can do that is to bomb the price, and when you do that on a product that is available in infinite supply, there’s no bottom to that game. That violated my principle that each SKU should be profitable. Secondly, well, how would you like to go home at night and brag that you sold a thousand cases of cigarettes that day?