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

by Patty Civalleri

My ethics were not, shall we say, entirely ethical in their genesis nor had my hands been entirely clean while I was running Pronto for Rexall. To quote the late, great senator Sam Ervin in the Watergate hearings, when he was asked if he had ever broken the law, “the statute of limitations has expired on all my sins.”

“But how could you afford to pay so much more than your competition?” The answer, of course, is that good people pay by their extra productivity. You can’t afford to have cheap employees.

Whenever I couldn’t answer “the bell” (like when I went into a coma for three weeks after unloading a truck in a rainstorm), Leroy did, in addition to managing one of the seven stores.

I like the casual mention of a three week coma. Never discussed again, btw.

The supermarket, like network radio, also began about 1930. What distinguished the supermarket was its parking lot, not what was inside the store. (“Self-service” had started fifteen years earlier.) The supermarket rose to prominence because it recognized the automobile, something that department stores did not recognize until after World War II. Because of this, early supermarkets were free-standing or carved into existing business districts next to stores that themselves had no parking. “Shopping centers” are mostly a post–World War II phenomenon. The supermarket was then perfected by yet another set of wheels, when the shopping cart was invented in 1937.

The correlation between alcohol consumption and levels of education is about as perfect as one can find in marketing.

The op-ed pieces in the LA Times fretted about how we would spend all that leisure time, since the thirty-five-hour workweek was now a sure thing.

And when the flesh goes from mere solidity to outright tumescence, in June 1998, the Supreme Court issued a sexual harassment decision that would inspire me, as an employer, to put saltpeter in the stores’ water supply. (But of course, this was merely a passing figment.)

TMI, Joe

Everybody worked the check stands in the course of a day, including the Captain. Nobody got stuck there all day long, as it is part of “The Human Use of Human Beings” discussed in “The Last Five Year Plans” chapter.

(a policy is a “standing decision,” as I was taught at Stanford)

Ah, those pre-electronic banking days! A bad snowstorm at O’Hare could delay the clearance of checks in North Carolina by four days! (“Remote disbursement” was the polite term for geographical float.)

Generally, labor expense in grocery retailing is relatively small, compared with manufacturing or the professions or restaurants. This was one reason I could get away with Trader Joe’s high compensation policies. Cost of Goods is the dominant expense. The funny thing is that grocers seem to spend more effort squeezing payroll than squeezing Cost of Goods Sold, though there is at least five times more opportunity to save money in the latter.

Because of internal theft, one of the most important non-merchandise suppliers may be a detective agency. It is very hard to find effective agencies. The nature of the work tends to attract unstable people. I often suspected that the operatives were worse than the criminals.