Becoming Trader Joe Quotes

“In a lecture at the University of Southern California Business School, I talked about this. A young woman raised her hand: “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.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“Time and again I am asked why no one has successfully replicated Trader Joe’s. The answer is that no one has been willing to pay the wages and benefits, and thereby attract—and keep—the quality of people who work at Trader Joe’s. My standard was simple: the average full-time employee in the stores would make the median family income for California. Back in those days it was about $7,000; as I write this, it is around $40,000. What I didn’t count on back there in the 1960s was that so many spouses would go to work in the national economy. When I started, average family income was about the same as average employee income. The great social change of the 1970s and 1980s moved millions of women into the workplace. Average family income soared ahead. But we stuck with our standard, and it paid off.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“I concluded that I didn’t have to find an optimum solution to Pronto’s difficulties, just a reasonable one. Trying to find an optimum solution in business is a waste of time: the factors in the equation are changing all the time. But you’ve got to have something to hang your hat on. The one core value that I chose was our high compensation policies, which I had put in place from the very start in 1958. This may sound like a strange way for polarizing a business, but I did not want to destroy the faith that Pronto Markets’ then-handful of employees had in me and in our common future. After all, they had just ponied up half the equity money needed to buy out Rexall.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“It is better to be vaguely right than exactly wrong. —Carveth Read”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“So one of the really nice things about my career is that I was never an absentee dad. Workaholic, yes, but not absentee. What price glory? When is enough, enough?”
― Patty Civalleri, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“The willingness to do without any given product is one of the cornerstones of Trader Joe’s merchandising philosophy.”
― Patty Civalleri, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“Carry individual items as opposed to whole lines. We wouldn’t try to carry a whole line of spices, or bag candy, or vitamins. Each SKU (a single size of a single flavor of a single item) had to justify itself, as opposed to riding piggyback into the stores just so we had a “complete” line. Depth of assortment now was of no interest. As soon as Fair Trade ended in 1978, we began to get rid of the hundred brands of Scotch, seventy brands of bourbon, and fifty brands of gin. And slowly (it was like pulling teeth) we dismantled the broad assortment of California boutique wines. No fixtures. By 1982, the store would have most of its merchandise displayed in stacks with very little shelving. This implied a lower SKU count: a high-SKU store needs lots of shelves. The average supermarket carries about 27,000 SKUs in 30,000 square feet of sales area, or roughly one SKU per square foot. Trader Joe’s, by 1988, carried one SKU per five square feet! Price-Costco, one of my heroes, carried about one SKU per twenty square feet. As much as possible I wanted products to be displayed in the same cartons in which they were shipped by the manufacturers. This was already a key element in our wine merchandising. Each SKU would stand on its own two feet as a profit center. We would earn a gross profit on each SKU that was justified by the cost of handling that item. There would be no “loss leaders.” Above all we would not carry any item unless we could be outstanding in terms of price (and make a profit at that price per #7) or uniqueness. By the end of 1977, we increased the size of the buying staff, adding one very key person, Doug Rauch, whom we hired out of the wholesale health food trade. Leroy, Frank Kono, Bob Berning, and Doug rolled out Five Year Plan ’77, which for purposes of this history I call Mac the Knife. Back in those days we had no idea how sharp that knife would become! We just wanted to survive deregulation. Everything now depended on buying. So here we go into the next chapter, Intensive Buying.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“Key Elements of Five Year Plan ’77 What follows did not happen overnight. Among the guidelines set in February 1977 (remember, Fair Trade on alcohol was not finally ended until 1978): Emphasize edibles vs. non-edibles. I figured that the supermarkets would raise their prices on foods to make up for the newly reduced margins on milk and alcohol. This would give us all the more room to underprice them. During the next five years we got rid of film, hosiery, light bulbs and hardware, greeting cards, batteries, magazines, all health and beauty aids except those with a “health food” twist. We began to cut back sharply on soaps and cleaners and paper goods. The only non-edibles we emphasized were “tabletop” items like wineglasses, cork pullers, and candles. It was quite clear that we should put more emphasis on food and less on alcohol and milk. Within edibles, drop all ordinary branded products like Best Foods, Folgers, or Weber’s bread. I felt that a dichotomy was developing between “groceries” and “food.” By “groceries,” I mean the highly advertised, highly packaged, “value added” products being emphasized by supermarkets, the kinds that brought slotting allowances and co-op advertising allowances. By embracing these “plastic” products, I felt the supermarkets were abandoning “food” and the product knowledge required to buy and sell it. But this position wasn’t entirely altruistic. The plan of February 20, 1977, declared, “Most independent supermarkets have been driven out of business, because they stupidly tried to compete with the big chains in plastic goods, in which the big chains excel.” Focus on discontinuity of supplies. Be willing to discontinue any product if we are unable to offer the right deal to the customer. Instead of national brands, focus on either Trader Joe’s label products or “no label” products like nuts and dried fruits. This was intended to enable the Trader Joe’s label to pick up momentum in the stores. And it worked.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“We fundamentally changed the point of view of the business from customer-oriented to buyer-oriented. I put our buyers in charge of the company. From 1958 through 1976, we tried to carry what the customers asked for, given the limits of our small stores and other operational parameters. Each store manager had great latitude in what was carried and from what supplier it was ordered. There was very little central distribution except for Trader Joe’s labeled California wines or imports. Each store probably had access to ten thousand stock keeping units (SKUs), of which about three thousand were actually stocked in any given week. By the time I left in 1989, we were down to a band of 1,100 to 1,500 SKUs, all of which were delivered through a central distribution system. The managers no longer had any buying discretion and there were no “DSDs,” or direct store deliveries. And along the way not only did we drop a lot of products that our customers would have liked us to sell, even at not-outstanding prices, but we stopped cashing checks in excess of the amount of purchase, we stopped all full-case discounts, and we persistently shortened the hours. We violated every received-wisdom of retailing except one: we delivered great value, which is where most retailers fail.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“The Most Important Strategic Decision Was to Become a Genuine Retailer The fundamental job of a retailer is to buy goods whole, cut them into pieces, and sell the pieces to the ultimate consumers. This is the most important mental construct I can impart to those of you who want to enter retailing. Most “retailers” have no idea of the formal meaning of the word. Time and again I had to remind myself just what my role in society was supposed to be. Many of the policy decisions for a retailer boil down to this: How closely should we stick to the fundamental retailing job? “Retail” comes from a medieval French verb, retailer, which means “to cut into pieces.” “Tailor” comes from the same verb. The fact is that most so-called retailers don’t want to face up to their basic job. In Pronto Markets we did everything we could to avoid retailing. We tried to shift the burden to suppliers, buying prepackaged goods, hopefully pre-price-marked (potato chips, bread, cupcakes, magazines, paperback books) so we had no role in the pricing decision. The goods were ordered, displayed, and returned by outside salespeople. To this day, supermarkets fight with the retail clerks’ union to expand their right to let core store work be done by outsiders. Whole Earth Harry’s moves into wine and health foods had taken us quite a distance into genuine retailing. In our cheese departments we were literally taking whole wheels and cutting them into pieces. I took this as an analogy for what we should do with everything we sold. Getting rid of all outside salespeople was corollary to the programs that would unfold during the next five years. In Mac the Knife, no outsiders of any sort were permitted in the store. All the work was done by employees. The closest thing to it that I see these days is Costco, which shares many features with Trader Joe’s.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“I had some idea of what had to be done, thanks to all we had been learning during the previous six years—from breaking Fair Trade on imported wine, developing private label California wine, and busting the price of health foods and cheeses. But to an extent we were just like a little kid running around while being kept from harm by a kiddie-keeper. We were “protected” by price controls on almost 50 percent of what we sold. Now we were ready to throw off the leash.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“When I was young, all the institutions were staffed with these Depression-scarred men—banks, utilities, railroads, most government bureaus, even letter-carriers. In many cases, they were overqualified for the work they performed and as a result the institutions tended to perform well. This is an aspect of the Truman-Eisenhower years—years that now seem islands of calm—that is overlooked.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“After that I became somewhat of a connoisseur of the Fair Labor Standards Act, and of California’s Labor Department’s own interpretations of it. This knowledge has served me in good stead in all the companies I ran post–Trader Joe’s and in all my consulting work.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“Word of Mouth: the Power of True Believers As everyone knows, word of mouth is the most effective advertising of all. Or, when in my cups, I have been known to say that there’s no better business to run than a cult. Trader Joe’s became a cult of the overeducated and underpaid, partly because we deliberately tried to make it a cult once we got a handle on what we were actually doing, and partly because we kept the implicit promises with our clientele. I used to work every Thanksgiving Day in one of the stores. They only let me bag, because I had lost all my checker skills. One Thanksgiving, a woman came in and asked for bourbon. I told her that we had none, because we had not been able to make the right kind of deal (this was after the end of Fair Trade, when we were deep in the Mac the Knife mode). “That’s all right,” she exclaimed. “I know what you’re trying to do for us!” Note the us. There aren’t many cult retailers who successfully retain their cult status over a long period of time. A couple in California are In ’n Out Burger and Fry’s Electronics. But across America, in every town, there’s a particular donut shop, pizza parlor, bakery, greengrocer, bar, etc., that has a cult following of True Believers. The old Petrini’s of the 1950s and 1960s had that status when it came to meat. Brooks Bros had that status until the 1970s. S. S. Pierce in Boston was another. But all of them failed to keep the faith. Beware of ever betraying the True Believers! The fury of a woman scorned is nothing compared with that of a betrayed cultee.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“What we gave mostly was wine. Especially after we made this legal(!) by acquiring that Master Wine Grower’s license in 1973. Most requests were made by women (not men) who had been drafted by their respective organizations to somehow get wine for an event. We made a specialty of giving them a warm welcome from the first call. All we wanted was the organization’s 501c3 number, and from which store they wanted to pick it up. We wanted to make that woman, and her friends, our customers. But we didn’t want credit in the program, as we knew the word would get out from that oh-so-grateful woman who had probably been turned down by six markets before she called us. Everybody wanted champagne. We firmly refused to donate it, because the federal excise tax on sparkling wine is so great compared with the tax on still wine. To relieve pressure on our managers, we finally centralized giving into the office. When I left Trader Joe’s, Pat St. John had set up a special Macintosh file just to handle the three hundred organizations to which we would donate in the course of a year. I charged all this to advertising. That’s what it was, and it was advertising of the most productive sort. Giving Space on Shopping Bags One of the most productive ways into the hearts of nonprofits was to print their programs on our shopping bags. Thus, each year, we printed the upcoming season for the Los Angeles Opera Co., or an upcoming exhibition at the Huntington Library, or the season for the San Diego Symphony, etc. Just printing this advertising material won us the support of all the members of the organization, and often made the season or the event a success. Our biggest problem was rationing the space on the shopping bags. All we wanted was camera-ready copy from the opera, symphony, museum, etc. This was a very effective way to build the core customers of Trader Joe’s. We even localized the bags, customizing them for the San Diego, Los Angeles, and San Francisco market areas. Several years after I left, Trader Joe’s abandoned the practice because it was just too complicated to administer after they expanded into Arizona, Washington, etc., and they no longer had my wife, Alice, running interference with the music and arts groups. This left an opportunity for small retailers in local areas, and I strongly recommended it to them. In 1994, while running the troubled Petrini’s Markets in San Francisco, I tried the same thing, again with success, for the San Francisco Ballet and a couple of museums.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“The audience for Channel 28, the PBS station in Los Angeles, was demographically perfect for Trader Joe’s. In those days, however, PBS did not accept overt commercials. Alice had been quite active as a volunteer at the station. Through her contacts, we made arrangements to sponsor reruns of shows that tied to Trader Joe’s, such as the Julia Child shows, The Galloping Gourmet, and Barbara Wodehouse’s series on training dogs, which proved very effective! These reruns were not expensive compared with sponsoring first-runs and they had very good audiences. All we got was a “billboard” announcing that Trader Joe’s was sponsoring the show, but this was a cost-effective way of building our presence in the community. Another way we promoted ourselves on public TV was to “man the phones” during pledge drives. Our employees, led by Robin Guentert who was running advertising at that time (Robin became one of the most important members of store supervision after 1982, then President of Trader Joe’s in 2002), would show up en masse at the station. They loved being on TV, and we got the publicity. Promoting through Nonprofits Most retailers, when they’re approached by charities for donations, do their best to stiff-arm the would-be donees, or ask that a grueling series of requirements need to be met. In general they hate giving except to big, organized charities like United Way, because that way they escape being solicited by all sorts of uncomfortable pressure groups. At the very beginning of Trader Joe’s, however, we adopted a policy of using non-profit giving as an advertising and promotional tool. We established these policies: Never give cash to anyone. Never buy space in a program. That is money thrown away. Give freely, give generously, but only to nonprofits that are focused on the overeducated and underpaid. Any museum opening, any art gallery opening, any hospital auxiliary benefit, any college alumni gathering, the American Association of University Women, the Assistance League, any chamber orchestra benefit—their requests got a very warm welcome. But nothing for Little League, Pop Warner, et al.; that was not what Trader Joe’s was about.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“The tagline “thanks for listening,” which has been so copied and admired, derived from the successful 1976 senatorial campaign of S. I. Hayakawa. Hayakawa was a professor of linguistics at San Francisco State University (before he became university president). He knew how to use the English language. The calm manner of his radio commercials, his thanking the listener for staying tuned, really impressed me and, six years later, provided the chassis and the closer for Trader Joe’s commercials. We used the commercials to keep us in front of the public between editions of the Fearless Flyer. We didn’t do both at the same time, or else the stores would have been overwhelmed with business. In short, the radio commercials were and are extremely effective. In the course of this, my voice became one of the best known in California.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“In l982, however, the success of the KFAC broadcasts was so apparent that I dropped all newspaper advertising and put the money into outright commercials for Trader Joe’s. These were broadcast on demographically suited radio stations: mostly all-news or all-classical. This is still the pattern followed by Trader Joe’s. About the format of the sixty-second radio spots, which has attracted a lot of attention in media circles: I think that most radio commercials are terrible. They have too many “production values.” Even worse, they issue commands to the listener: “Buy this!” “Shop now!” “Hurry!” One should never use a mandatory sentence in addressing a customer; should never give orders. The subliminal message of a Trader Joe’s commercial is, “We’re gonna be around for a long time. If you miss out on this bargain, there’ll be another. If you have the time and inclination . . .” Most supermarket radio spots are paid for by cooperative advertising allowances from manufacturers. The supermarkets jam as many brands into sixty seconds as possible, because it maximizes their revenue. Information be damned! In sharp contrast, each Trader Joe’s spot was devoted to a single product, about which we tried to develop a story.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“One of the fundamental tenets of Trader Joe’s is that its retail prices don’t change unless its costs change. There are no weekend ad prices, no in-and-out pricing. In part this policy is made necessary by all those hundreds of thousands of Fearless Flyers that are out there. But I have always believed that supermarket pricing is a shell game and I wanted no part of it.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“The expansion of the Fearless Flyer to twenty pages was an important factor in the jump of Trader Joe’s sales after 1985. Down deep, the Fearless Flyer was an educational medium and hundreds of customers kept three-ring notebook collections of the issues so they could refer back to the articles. For years, we printed three rings on the cover. Equally important, however, it was an educational medium for our employees: A lot of our employees were under twenty-one; legally they could not have tasted the wines we were selling. So the Fearless Flyer was a sales tool for those employees. As we got deeper and deeper into vitamins, and FDA got goosier and goosier about claims by the health food industry, I didn’t want our employees to do any selling of vitamins and food supplements. When asked about a product, they were to refer to the Fearless, and a back copy file was kept at the store level for this purpose. (In 1993, Senator Orrin Hatch of Utah rammed a Magna Carta for health foods through Congress. The FDA hates the law, but all kinds of claims can be made now, which were impossible in my era.)”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“The advent of the Apple Macintosh in 1985 made a tremendous improvement in publishing the Fearless Flyer. Using a piece of software called Adobe® PageMaker, we were able to dis-intermediate most of the printer’s function and produce camera-ready copy entirely in our office. Pat St. John, whom Alice recruited for us in 1986 as head of advertising, made a great contribution here, cutting lead time by almost a week. Anyone who has been in advertising can appreciate the nerve-racking problems of products that are advertised but didn’t arrive in time to cover the advertising. I would have had a coronary without the Macintosh, which had made it possible to expand the Fearless Flyer from twelve pages to twenty. This created all the more space to advertise products, but it also potentiated the coronary potential, and the almost-as-bad requirement for still more cartoons! Please remember: Trader Joe’s was a low-overhead operation with all of us wearing several hats. Sure, some of the above could have been done pre-Macintosh, but at vastly greater expense.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“This massive increase in the mailing massively increased our advertising costs in the short run. I don’t believe, however, in advertising budgets that are based on a percentage of sales. You figure out the dollars needed to do the job right, and go ahead and spend them. As it turned out, the big sales generated by the Fearless Flyer dropped the cost of advertising as a percentage of sales after the fact. By the time I left Trader Joe’s, we were mailing millions of copies five times a year.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“We emphasized “informative advertising,” a term borrowed from the famous entrepreneur Paul Hawken, who started publishing in the Whole Earth Review in the early 1980s. These informative texts were intended to stress how our products were differentiated from ordinary stuff. Please see the chapter on Private Label Products for examples of claims we made.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“For artwork, I simply turned to nineteenth-century books and magazines, of which I built a large collection. I knew that (under the copyright laws of the time) works created prior to 1906 were no longer subject to copyright, so we were free to use the artwork. To create the cartoons, I would leaf through old sources until I found a cartoon that I thought would match the text. Much later, I learned from Robert Graves’s The White Goddess that what I was practicing was iconotropy, the deliberate misreading of images. Graves thought that a lot of myths had come from people misreading or twisting the meaning of the pictures on Greek vases. I spent the next nineteen years iconotropically creating those cartoons. They were at once a chore and a relief from the pressures of running the business. Best of all, they caught on with the public, and played a major role of establishing Trader Joe’s as a “different” kind of retailer, one that didn’t take itself too seriously.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“The Fearless Flyer began life in 1969 during the Good Time Charley phase of Trader Joe’s as the Insider’s Wine Report, a sheet of gossip of “inside” information on the wine industry at a time where there weren’t any such gossip sheets, for the excellent reason that few people were interested in wine. As of the writing of this book, 11 percent of Americans drink 88 percent of the wine according to contemporary wine gossip magazine the Wine Spectator. In the Insider’s Wine Report we gave the results of the wine tastings that we were holding with increasing frequency, as we tried to gain product knowledge. This growing knowledge impressed me with how little we knew about food, so in 1969, we launched a parallel series of blind tastings of branded foods: mayonnaise, canned tuna, hot dogs, peanut butter, and so on. The plan was to select the winner, and sell it “at the lowest shelf price in town.” To report these results, I designed the Insider’s Food Report, which began publication in 1970. It deliberately copied the physical layout of Consumer Reports: the 8.5” x 11” size, the width of columns, and the typeface (later changed). Other elements of design are owed to David Ogilvy’s Confessions of an Advertising Man. The numbered paragraphs, the boxes drawn around the articles, are all Ogilvy’s ideas. I still think his books are the best on advertising that I’ve ever read and I recommend them. Another inspiration was Clay Felker, then editor of New York magazine, the best-edited publication of that era. New York’s motto was, “If you live in New York, you need all the help you can get!” The Insider’s Food Report borrowed this, as “The American housewife needs all the help she can get!” And in the background was the Cassandra-like presence of Ralph Nader, then at the peak of his influence. I felt, however, that all the consumer magazines, never mind Mr. Nader, were too paranoid, too humorless. To leaven the loaf, I inserted cartoons. The purpose of the cartoons was to counterpoint the rather serious, expository text; and, increasingly, to mock Trader Joe’s pretensions as an authority on anything.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“To keep sales increasing during the mid-1970s, we relied on new ideas implemented in existing stores. This was my favorite form of growth. I don’t think that any given store ever fully realizes its potential. During those four years of no expansion in terms of number of stores, our dollar sales kept right on growing while the CEO of Trader Joe’s struggled with trying to reconcile good business practice with the Whole Earth Catalog. Whole Earth Harry indeed! In my private life, I had become an organic gardener. Few things have so enriched my life so much as my own personal conversion to organic gardening, something that I still practice except when the ants start raising colonies of aphids in my blood orange trees, and it’s Grant’s Ant Control to the rescue. In any event, the schizoid marriage of the party store with the health food store was a great success for Trader Joe’s, if not for the biosphere.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“This helps to explain why I went from 1974 to 1978 without opening another store, something that could be viewed as inexcusable, given the success of Whole Earth Harry. Again, however, I did the right thing for the wrong reason. When Fair Trade on milk and alcohol blew up in our face in late 1976, we were not locked into too many stores that had been built on the assumption that those 1930s laws would last forever. Among other things, this saved us from having increased our huge investment in liquor licenses, which plunged in value when Fair Trade ended. It left us in better shape to transition from Whole Earth Harry to Mac the Knife, a powerhouse that could draw people from twenty-five miles around, provided you leased stores with the boulevard access that would make that possible.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“In the background, given my commitment to the outer ecology of environmentalism, I replaced all the company cars with diesels, which used less crude oil and lasted longer than gasoline engines. The diesel cars did pay off briefly during the Second Energy Crisis of 1979, but they gave us a lot of trouble in the long run because the diesel-powered Oldsmobile station wagons that General Motors rushed into production had nothing but a beefed-up gasoline engine (internal pressures are much greater in a diesel) and they were in the shop more often than on the road. We aggressively redesigned the stores to conserve energy. To this day, Trader Joe’s stores don’t have very many windows, and all panes of glass are very small, an idea that had an accidental payoff in every subsequent earthquake and riot. As the young lady said back there in the God of Fair Beginnings chapter, I did the right thing for the wrong reasons.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“By 1976, Trader Joe’s, the Whole Earth Harry version, had evolved into a rather effective, very profitable retailer, but still small. We had a few private label food products outside of nuts and dried fruits (in which there is very little brand demand) and cheeses (ditto). We were still reliant on selling branded food products, bought in ordinary quantities, which made aggressive pricing unprofitable.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys

“Trader Joe’s first private label food product was granola. We installed Alta Dena certified raw milk, to the disgruntlement of Southland, and within six months were the largest retailers of Alta Dena milk, both pasteurized and raw, in California. We began price-bombing five-pound cans of honey, and then all the ingredients for baking bread at home. We installed fresh orange juice squeezers in the stores, and sold fresh juice at the lowest price in town. By late in 1971, we were moving into vitamins, encouraged by my very good friend James C. Caillouette, MD. Jim spent a lot of time talking with the faculty at Cal Tech. He was convinced that Linus Pauling was on to something with his research on vitamin C. I set out to break the price on vitamin C. At one point, I think, we were doing 3 percent of sales in vitamin C! Later, Jim forwarded articles from the British medical magazine Lancet, describing how a high fiber diet could avoid colon cancer. But where could we get bran? The only stores that sold it were conventional health food stores, who sold it in bulk, something that I have always been opposed to on the grounds of hygiene. And still am! Leroy found a hippie outfit in Venice—I think it was called Mom’s Trucking—which would package the bran. But bran is a low-value product. They couldn’t afford to deliver it. Since they also packaged nuts and dried fruits, however, we somewhat reluctantly added them to the order. And that’s how Trader Joe’s became the largest retailer of nuts and dried fruits in California! Brilliant foresight! Astute market analysis! By 1989, when I left Trader Joe’s, we regularly took down 5 percent of the entire Californian pistachio crop, and we were the thirteenth largest buyer of almonds in the United States—Hershey was number one.”
― Joe Coulombe, Becoming Trader Joe: How I Did Business My Way and Still Beat the Big Guys