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Trade Joe’s is a private enterprise which is a grocery store selling natural, healthy food and beverages. The enterprise started its operations in the year 1958 under the sponsorship of Joe Coulombe. The company’s headquarter is located in California and, but the operation of the store is widely spread in twenty five states. In 1979, Karl and Theo Albrecht who are rich entrepreneurs from Germany purchased the business though the name of the business remained (Len, 2005). The main competitors of Joe’s trade include Wild Oats and whole food while other large store such as Hannaford, Roche Bros, and Whole Foods finds it challenging to compete with this store.
The company does not establish service departments while, on average, it occupies a ten to fifteen thousand squire feet. On the other hand, the company deals with more than two thousand privately labeled products, which include beverages, soups, snacks, and frozen products. These privately supplied products constitute about seventy percent of the total revenue of the company. The space efficiency of Joe Trade, according to trade analysis it is about twice that of its competitors (Len 2005). The sales of the company for the last few years, average at about eight billion US dollars. This is far much higher than sales of competitors such as Beth Bath and Beyond.
In the grocery industry, Joe’s Trade is one of the outstanding players particularly, in the united states of American market. In the year 2009, the Supermarket News estimated that the enterprise was number twenty one of all the retail outlets in terms of sales and growth. In the same year, Consumer Reports place Joe’s Trade as number two most preferred and effective retail outlet behind Wegmans. Ethisphere Magazine ranks Trader Joe’s as the most ethical enterprise in the United States for three consecutive years, including 2008, 2009 and 2010.
The grocery is one of the fastest growing enterprises in United States of America. The store started as a single shop in Parkway in California at which, it first expanded the space to double in the attempt to accommodate more customers than before. In the year 1967, the company had several sandwich shops, cheese and orange juice. In 1987, the enterprise expanded its operations to Arizona, while, in the year 1993, the door of the outlet opened in Pacific Northwest. The tread continues and up to date the company operates in thirty one states including East Coast, Brookline, Washington and Cambridge among others. In October, this year, Trade Joe’s hit the three hundred and sixty five stores fully operational in the united states of American, a network named as one of the best in the grocery outlet business (Michael, Duane & Robert, 2007).
Trade Joe’s have five main competitive advantages over the competitors in the grocery industry in united states of America. This includes the price, quality products, healthy food, distribution network, and enthusiastic staff. The consumers enjoy about twenty five percent cheaper products from the Trade Joe’s stores than other competitor’s prices. The secret of the cheap prices are not known, as the company management remains silent on how they achieve it. Space efficiency and the success of skimming price strategy play an immense role in the achievement of this competitive advantage.
The products of Trade Joe’s are fresh, unique and quality in nature. Consumers purchasing products from these outlets rarely complain of poor quality or contaminated products. According to several governmental and nongovernmental organizations’ research and analysis, Trade Joe’s stands as one of the best grocery outlets in terms of quality and fresh standards. The cheap and quality products are the most competitive advantage that Trade Joes enjoys over the market competitors. On the other hand, some products offered by Trade Joe’s are unique as compared to those offered by other grocery enterprises, such as Whole Food Meijer and Kroger among others. Trade Joe’s achieves this significant competitive advantage, through the selection of suppliers and proper storage of the produce (Len, 2005). On the other hand, each of the outlets undertakes their only analysis on demand and hence, the quantity in stock depends on demand. In this case, the products have minimal chances of perishing.
The foods sold at Trade Joe’s Stores are organic and healthier as compared to what its competitors offer. The enterprise as a result of pressures from customers, however, offers ice cream, sodas, and chips. Meat is usually offered in the outlet, however, is free from antibiotic, and they are hormone free grown. The ingredients of items offered, according to nutrients are the best ever combination known in the market. As a result, the stores are immensely proffered particularly to the large number of consumers, who value healthy eating. This is one of the main reasons why the enterprise cancelled all the supply of food products from China.
The distribution network of Trade Joe’s company is unique and comprehensive as compared to it competitors. In the attempt, to reduce the number of intermediaries in acquisition of food products, the company purchases the products direct from the manufacturers. These manufacturers transport their products to the distribution centers, from where the outlets get their supplies. The widely spread distribution centers ensure a large market coverage. As a result, consumers get the products at their convenient store and hence, most of them do not travel to shop in the store. On the other hand, the stores offer unique services such as attractive packaging and transport where necessary.
The choice of the location of distribution centers and stores demands on research well conducted by the strategic management and research team (Charles & Hill, 2007). The two main factors considered in the infrastructure and demographic factors. The infrastructure is immensely essential for the transport and communication to and from the stores. The demographic factors analyses include the population, the income and level of education among others. This is immensely significant to determine the initial and sales expectations to avoid loss as a result of low turnover and food spoilage.
As oppose to most employees from organizations all over the United States of America, employees of Trade Joe’s are proudly working in these stores. They have the passion to their work and are enthusiastic towards the products they sell. This is extremely essential in that they give the organization the support necessary from the human resource. To win their support, Trade Joe’s has exceedingly attractive employee package, wages and benefits, which are above the union wage level. In this case, the organization maintains it key employees while to acquire qualified and hand working employees is exceptionally easy.
The minimum entry pay per hour of employee is eight dollars, where the after three consecutive months of work, employees turns into permanent terms. The company offers health insurance to both the permanent and part time employees; this benefit extends to the dependants of the organization. The part time employees work for twenty hours per week, who after six months receive a pay increase. These among other benefits create a team which extremely good morale of employees, who devote their energy toward the achievement of organization goals.
The Trade Joe’s SWOT analysis points out several areas of strength, but, there are two main areas of strength. These include the support of employees and customers’. The employees will help to drive the mission of the organization and hence, it achieves its objectives at ease. Customers are extremely essential to any organization without the customer; no rational entrepreneur would start up a business (Charles & Hill, 2007). The support of these people is immensely essential. They are the source of revenue, through their purchases and consumption of the company’s products. It is apparent through various researches that Trade Joe’s enjoys the support of its customer and hence, it has an assurance of sales now and in the future.
The prominent grocery outlet is facing some weaknesses. The company is extremely conservative and secretive, incredibly few of its customers or members of the public know about the suppliers to the enterprise. On the other hand, the company strictly operates on organic products despite the fact that the world is changing slowly into generic products. The other weakness of Trade Joe’s company is the space they utilize. During the peak days and hours, customers overcrowd in the store, which is not appearing to customers despite the cheap and quality products it offers (Hill & Gareth, 2009).
There are various opportunities, which Trade Joe’s can exploit, in its operation. First, the highly motivated employees are usually ready to devote their energy and knowledge towards the organizational needs. The company should make use of them in the most optimum way (Michael, Duane & Robert, 2007). The other opportunity of Trade Joe’s is that it can invest in other countries apart in the United States market, and yet succeed in its operation. With the strategies, it has applied including creating highly motivated employees and low prices to customers the company will for sure succeed.
There are two main threats faced by Trade Joe’s enterprise. First, the growth of the company may challenge the control. The expanded operation results into increased human resources to control logistic activities. It calls for the management to strengthen their command through the additional of other management personnel (Wright & McCrea, 2007). This can result into diluted management and control as each manager added come with their own philosophies. Secondly, enterprise operation on organic products may not hold for long. This is as a result of the fact that the world is changing towards generic products to complement the organic products. In this case, the company should start operation on both categories to avoid future panic.
In conclusion, Trade Joe’s have successfully out stood against its competitors and eventually turns as one of the best outlets in United States of America. There are various issues, which come out, as differentiating grounds of the enterprise among others. The price of the commodity offered makes an immense difference as the enterprises charges about twenty five percent less than the competitor. The quality of the products highly affects the customer royalty and the support they accord the company. Consumers value their money and, therefore, offering quality products makes Trade Joe’s the most preferred grocery outlet.
There are various issues grocery and other retail outlets and stores should learn from the case of Trade Joe’s. First, the distribution channels or systems used counts to the success of an organization (Michael, Duane & Robert, 2007). This is particular for derivate and perusable items. Trade Joe’s cascaded to do away with the intermediary in order to reduce the time taken and interference with the quality of products. Secondly, the significant of better employment terms comes out clearly in the case of Trade Joe’s, it is extremely essential for business enterprises to offer outstanding packages and benefits to their employees and eventually they will drive the mission of the organization to even unexpected level.
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