Copying Trader Joe’s

Tuesday, January 17th, 2012

Copying Trader Joe’s isn’t as easy as it might sound:

Only Walmart comes close to approaching Aldi in size if not global reach, and the efficiency, popularity, and profits of Trader Joe’s have not gone unnoticed by the Walton family. You can’t dash in for a good bottle of chardonnay and a package of fresh chicken enchiladas at Walmart. Aisles stretch the length of a football field, and on entering, one panics like a jungle primate discovering the Serengeti; a sharp longing for the crowded warrens and easy pickings of Trader Joe’s can seize the mind.

In 2009, Walmart tried to duplicate the Trader Joe’s experience. Its homespun prototype was named Marketside by Walmart. Four stores opened in the Phoenix area, each averaging 16,000 square feet—large for a Trader Joe’s but postage-stamp size for Walmart. Marketside turned out to be a failure. Stores reportedly took in less than $70,000 a week, a fraction of what a single Trader Joe’s can earn, and last year Walmart ended its small-scale experiment, shutting down the Arizona quartet.

Fresh & Easy has enjoyed better luck chasing Trader Joe’s. The British-owned company runs 168 stores (more are slated), but Fresh & Easy has encountered setbacks, too. In the past year 13 stores have been closed for underperforming and, making matters embarrassing, Human Rights Watch has issued a 104-page report detailing violations of workers’ rights at Fresh & Easy and at its parent company, Tesco. Aggressive campaigns to avoid complying with U.S. labor laws were cited.

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