We have uploaded two different case solutions.

 Case study questions

answered in the first solution:

1. Identify multiple innovative efforts of Trader Joe's over its

50+ year history.
2. Consider the uniqueness of Trader Joe's to its peers, what
has made Trader Joe's unique?
3. How do they continue to compete against the larger chains?
4. How do they manage to outperform their peers?

Case study questions answered in the second solution:

1. What’s the key issue/problem/opportunity in this case?

2. Which of the generic competitive strategies do you think
Whole Foods, Kroger, and Trader Joe’s were using at the
time of the case? Explain why. Don’t be afraid to use value
chain logic to support your answer.

1. Identify multiple innovative efforts of Trader Joe’s over

its 50+ year history.
Trader Joe’s innovative efforts over its 50+ year history include:

Smaller-footprint neighborhood grocery stores (less than 15,000

square feet) that stock unusual and interesting foods and drinks
sourced from around the world that might be new to customers and
those from around the corner. (Typical grocery stores are 40,000 to
50,000 square feet).

The company carries about 4,000 stock-keeping units per location as

compared with as many as 50,000 units that are generally carried by
most grocery stores. Instead of a wide selection of fresh meats and
produce, the store features a wide collection of frozen foods. It also
tends to sell its fruit by the piece rather than by the pound.

The company offers 80% or more low-priced private label products. It

includes its now-famous Charles Shaw Winery private label wines that
cater to its intelligent, educated, sophisticated, and interesting
customer base. These are the urbanites, Volvo-driving professors,
college students, and Trader Joe’s groupies who are health conscious,
love to travel, like trying new things, and are interested in finding a
great bargain.

The company maintains its uniqueness and low prices by avoiding the
following trends and purchasing directly from manufacturers rather
than working through distributors and wholesalers. It also stays away
from trade shows that feature products that every other retailer sees.
Unlike other grocery stores, suppliers are paid promptly and allowed
to place their products on the shelves without incurring a charge.

The company requires vendors to maintain complete secrecy about

their relationship with the retailer to keep rivals and customers from
knowing where it sources its private label products. The suppliers
provide Trader Joe’s with a much lower-cost version of their branded
products that might be sold at other retailers.

Low investments in technology. There are no self-checkout lanes or

flat-screen TVs at checkout counters. Trader Joe’s prefers a customer-
friendly environment where customers actually talk with employees.

Marketing primarily through a customer newsletter produced in-

house, Fearless Flyer. The company provides information to its
customers. These include various products and new product
additions, quirky, employee handwritten in-store signage, and
occasional short radio advertisements that it produces itself, instead
of the traditional television commercials requiring professional actors
or cutout coupons in the Sunday newspaper. There are no Facebook
pages, Twitter accounts, or loyalty programs. Customers can return
products with no questions asked.

Hiring reliable staff and paying them wages that are more than what is
received at rival grocery stores. The company contributes 15.4% of
employees’ pay to retirement accounts. Some health care benefits are
even offered to part-time employees. New “crewmembers” receive ten
days of indoctrinating training about the company’s seven core values.

2. Consider the uniqueness of Trader Joe’s to its peers,

what has made Trader Joe’s unique?
From its marketing strategies to its huge array of private label
offerings, Trader Joe’s is unique in almost every aspect of its operation
and on several levels compared to its peers.

Trader Joe’s carries a large variety of products from around the world,
yet only a very few brand name products.

Store managers are discouraged from making announcements to

crewmembers over the intercom system. Instead, a bell system to
communicate key messages is used.

Crewmembers restock shelves during normal opening hours to allow

customers to talk with and ask questions. Crewmembers walk
customers directly to the products they are trying to locate rather than
direct them to an aisle.

Crewmembers are friendly, people-people who are well-looked-after

with great benefits, paid well, and often hang out with each other after
work hours.

Trader Joe’s has created a…

4.     What generic strategy does Trader Joe’s pursue? Support your answer with evidence from
the case.
Trader Joe’s generic strategy is focused on differentiated products for a differentiated target
market at low prices. The company offers its branded products to highly educated and low
income generating target market, at lower prices as compared to its customers. It makes its sales
approach by using the secrecy strategy to thrill their customers and thus, increase demand and
pursue growth…………..
Trader Joe’s has internally created a brand for its company
using a different strategy as compared to other supermarkets.
Its approach of effective relationship-building program pleases
customers through unrivaled customer service. This case study
presents many factors that play a part in their customer
relations strategy. Trader Joe’s does not focus on advertising.
Rather, it focuses on effective internal communications with
employees to build strong customer relationships. Trader Joe’s
takes a progressive approach to internal communications by
allowing their employees to bring their own creativity to the
workplace, by providing them with the context in which their
role contributes to the business success, and asking for
employees…show more content…
Trader Joe’s calls their target customer “the educated
consumer” and they reach this group by placing stores among
well-educated residents (Guth, and Marsh 183-187). They also
reach their target audience through formal and informal
research such as customer surveys. Another way in which
Trader Joe’s reaches its audience is through the Fearless Flyer,
Trader Joe’s supermarket newsletter. It is described as being
“so effective that Trader Joe’s channels most of its marketing
efforts into public relations rather than traditional advertising”
(Guth, and Marsh 183-187).
Trader Joe’s forgoes advertising for a strategy of customer
relationship management because advertising “can’t create an
experience. It’s the personal relationship with these people that
builds loyalty” according to St. John, vice president of Trader
Joe’s (Guth, and Marsh 183-187). Through this strategy,
Trader Joe’s has seen much success. At the time of this case
study, analysts estimated annual revenues to be around 3
billion. Today they are estimated to be around 8.5 billion. The
effect is that the company has grown and still continues to
grow. Trader Joe’s has gone from having 220 stores in 17
states in 2004 to 356 stores in 28 states as of June 2011
(“Trader Joe’s”). One area of attention for Trader Joe’s is to
not lose sight of this customer relationship strategy as it
continues to grow into a national or even global company. The
company needs to continue to “pay attention to the information
it

Introduction Re-invention and targeted approach towards

achieving competitive advantage were the key strategic actions
taken to make Trader Joe’s (TJ) from a glorified regional
convenience store to a nationwide specialty retailer, and that
might just be the most important thing in the supermarket
business. The footprint of this success lies in the efficient
utilization of the company’s resources and their unique
capacity to deploy its resource and capabilities(BB835). The
result of such unique circumstances helped TJ to stay far ahead
of its competitors in terms of customer satisfaction and brand
loyalty. This TMA proposes that, through a company’s
resources and capabilities TJ managed to imitate Key Success
Factors (KSF) that created value,…show more content…
Unfortunately to build the value chain we would need a more
thorough investigation on the TJ’s processes and arrangements.
In my opinion to make the proper investigation of the
resources gaps and missed capabilities it is required to be very
familiar with the company’s organizational aspects and
business process. But due to the fact the company does not
publish any investor reports and is has never gone public
(Stock Exchange or Private equity funding). In my opinion the
Porter’s tool such as Value chain analysis in this case has
disadvantages comparing to Grant’s simple approach to
resource management and strategic planning. According to
Barney (1991), a firm can be said to possess competitive
advantage when it achieves superior performance over its
competitors by implementing a value-creating strategy that is
not simultaneously being implemented by a competitor. TJ is
Barney differentiates simple competitive advantage from
sustainable competitive advantage, which is more durable
because existing or future competitors cannot duplicate the
benefits of the company’s strategy. Recommendations and…
show more content…
Coulombe didn’t have a long term strategy in mind. According
to the case study only after the arrival of John Shields TJ
pursued the idea of expanding the markets and not playing the
niche supermarket offering their tailored service in California.
The previous sections already demonstrated how the internal
resource, in this case the loyal customers insisted on the
growth strategy and helped the management to open their eyes
for better and more consistent strategies. The major
stakeholders customers admired every opening of the New
shop of TJ either creating fan pages and or by cueing for every
newly opening