Trader Joe - Player in the Retail Industry Who Displayed Great Ingenuity

With increased competition in the retail industry, players have to come up with unique ways of doing businesses so as to stay ahead of the lot. The industry is in a constant state of change, with consumer preferences changing by the day. As such, the players have to shift their strategies to align with consumer trends and develop mechanisms of anticipating customer trends so as to effectively meet their needs (Wunker, 2011). Failure to do this will lead to slow, sure death as witnessed by some once flourishing retail firms now filing for bankruptcy. Playing in a market with such big players as Wal-Mart and Target, one has to be really creative in order to survive, let alone making profits.

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One such player in the retail industry who displayed great ingenuity and authenticity in running its operations was Trader Joe. The firm attracted a cult like following from consumers who created fan pages in social media platforms requesting the firm to open up a branch in their state. The firms successful strategies were clearly seen in the rankings as the best retail store in the country. But with success comes imitators who would want to eat a portion of the profit enjoyed by the retailer. Many firms such as the giant Tesco tried imitating Trader Joes business strategy by opening up small retail stores in the neighborhoods. The firms attempts did not succeed, and the firm was left with a substantial loss that forced it to sell its retail business in the United States. Undeterred by this loss, retail giants such as Wal-Mart experimented with the neighborhood retail concept which posted encouraging results that prompted the firm to expand its concept of neighborhood retail stores. Soon other players such as Target, Giant, Publix and Tops would follow suit and open up experimental neighborhood retail businesses in different states. With the market congested and its business model replicated by almost all players in the industry, many would expect that Trader Joes operations would soon reporting losses. It, however, continued to post impressive performance despite the stiff competition. This was due to the firms adoption of unique operational strategies and marketing philosophy that made it stand out from the rest and in the process keep winning the loyalty of its clientele.

Trader Joe had a niche target market that serves the needs of a well-educated breed of customers who were intelligent, educated and inquisitive. With a niche marketing strategy, chances of going wrong are very slim. This is because this marketing strategy seeks to meet the needs of customers, solve business problems and ease the pain. Some of the companies that have adopted this strategy and hugely succeeded in the process are Under Armour which designed sporting apparel that do not drip wet with sweat, the Lehmans which deal with the shipment of non-electrical appliances throughout the world and SendAPackage.com that specializes in the delivery of packages to inmates in a practice that is riddled with numerous regulations. As niche business is all about meeting the needs of the customer, nothing could go wrong as the customers will be continually satisfied, keeping the business running and profitable as was the case with Trader Joe. Other competing businesses specialized in meeting the general needs of the target market with no specialized segment of the consumer block.

Keeping ones employees satisfied is one way of ensuring that a business continually flourishes despite the competition in the market. Trader Joe ensured that its employees were well paid, much more than any other retail store would pay its staff. In an industry where the mean hourly rate stands at $10.47, Trader Joe compensates its labor force pretty well, offering an hourly rate of $12 for sales interns. In a year, full-time employees pocket $50, 000 in an industry where the mean annual wage is $21,780. Sales captain earn $100,000 every year, making Trader Joe one of the most sought after employers in the land. This explains why the retail store receives numerous applications whenever it opens a new branch in a different state. The company would receive more than a thousand applications for only 50 vacant slots, showing how marketable the firm was ("Retail Salespersons; Occupational Employment Statistics", 2015). Its hiring strategy is quite unique; it absorbs its employees from one of the countrys most unutilized resource base- artsy, extroverted and creative college graduates whose skills do not give them the opportunity to secure employment in technical fields. Trader Joe offers them a platform to freely express themselves and interact with a crowd that has similar extrovert and creative tendencies. New employees spend about ten days learning about the business operations though it is not like any other training program as performed by mainstream retail stores; these new members are taught more about the core values of the firm rather than on the routine retail store operations. The employees were encouraged to be familiar with the firms products and were encouraged to experiment with different products of the firm. The employees were further encouraged to be generalists, not specialists, knowing general practices of the firm. They would be rotated every one hour, and such practices make employees satisfied and more fulfilled.

As the company expands its operations to new territories, it should adopt newer strategies to keep the record of the impressive performance posted by the firm. The greatest success stories for companies have been their ability to capture new markets. From Facebook to Standard Oil, the success of any business entering new territories is hinged on its ability to establish appropriate strategies for capturing their new markets. Traditional business strategies often fail in making a winning case for companies expanding into new frontiers and as such distinctive approaches ought to be adopted to conquer these new territories. For Trader Joe to maintain its impressive record in the new branches and markets, it is entering it has to adopt some strategies to maintain its winning ways (Wunker, 2011).

The challenge in new markets in most cases is not about who is in control in the market, but how to win the customer inertia in these new frontiers. But as the retail business is well established in the United States, Trader Joe might opt to merge with other established brands in the industry and slowly rise to become a force to reckon with in the industry and to be the leader of the new market.

Trader Joe should time its market entry so that it can be impactful. Most firms fail to make an impact in their new markets by going in too early. Diners Club had an advantage in its industry, but it did not take a long time before it lost its competitive advantage. The company should, therefore, time its entry in such a manner that it will have a greater impact and establish barriers to entry that will restrict other entrants into the market, enabling the firm to maintain a leadership role.

References

Retail Salespersons; Occupational Employment Statistics. (2015). Retrieved 28 September 2016, from http://www.bls.gov/oes/csurrent/oes412031.htm

Wunker, S. (2011). Achieving growth by setting new strategies for new markets a. Retrieved 28 September 2016, from http://iveybusinessjournal.com/publication/achieving-growth-by-setting-new-strategies-for-new-markets/