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Gourmet grocer Trader Joe’s hits R.I. market

01:00 AM EDT on Friday, October 31, 2008

By Paul Grimaldi

Journal Staff Writer

The grocery offers its own brands, allowing it to keep costs low by buying directly from the manufacturers. The foods don’t make it to the shelves unless they’re approved by a tasting panel.


The Providence Journal / Bob Breidenbach

WARWICK — Offbeat grocery-store chain Trader Joe’s this morning opens its first Rhode Island market on Bald Hill Road.

Known for its Hawaiian-shirt-wearing employees, $3 bottles of wine and inexpensive, gourmet-style goods, Trader Joe’s has expanded rapidly in recent years.

The Monrovia, Calif.-based grocer now operates more than 300 stores in 24 states and Washington, D.C., according to company spokeswoman Alison Mochizuki.

The grocer, which has 16 supermarkets in Massachusetts, opens today at 1000 Bald Hill Rd., a shopping center owned by Linear Retail Properties LLC, of Burlington, Mass.

Trader Joe’s has mastered mixing high-end items with low-priced deals.

The company started in California in the 1960s when founder Joe Coulombe revamped Pronto Markets, his chain of Los Angeles-area convenience stores, by adding more goods, emphasizing health foods and private-label products.

More than 80 percent of the chain’s products are now Trader Joe-related. At a typical supermarket chain, less than 20 percent of the goods are store-label brands.

The model remained intact after he sold the chain in 1978 to the two billionaires who own the ALDI Group, a food conglomerate based in Essen, Germany. ALDI also made its Rhode Island debut this year.

Trader Joe’s is still owned by German entrepreneur Theodor Albrecht, who founded the ALDI chain with his brother Karl. ALDI operates Trader Joe’s as a separate company.

Trader Joe’s reputation is built, in part, on the taste and price of Two Buck Chuck, a wine that sells for as little as little as $1.99 in some of its outlets. Alas, for Joe’s acolytes in Rhode Island, Chuck didn’t make the cut — the Warwick store does not have a liquor license.

Coulombe also introduced Trader Joe’s now-trademark Polynesian décor and gave employees Hawaiian shirts and leis to wear.

The Warwick store maintains the theme, with Rhode Island twists.

There is a seascape mural on the walls and a model of the Point Judith lighthouse atop the shelves of one aisle, among other touches.

“I really wanted Rhode Islanders to walk in and say, ‘This is my Trader Joe’s,’ ” said Paul Bourgeois, the store’s manager.

The store shares the other attributes of a typical Trader Joe’s:

•It’s roughly the same size as many of its brethren — about 12,000 square feet. That’s about the size of a CVS or a Walgreen’s drugstore. The median supermarket size was 47,500 square feet in 2007, according to the Food Marketing Institute.

•It carries about 2,000 products — less than 10 percent of the number sold in a Stop & Shop, Shaw’s or other supermarkets.

•Most of those products will be sold under Trader Joe’s name or some cheeky takeoff on the moniker: Trader Jacques,’ Trader Jose’s or Trader Giotto, for instance.

•Those products get on the shelves only if a tasting panel says so and stay there only if customers take to them and stick with them. Suppliers don’t pay the chain to put their products on the shelves, as they do in most supermarkets.

•While the food is gourmet style, the prices are bargain aisle; imported pizza sells for $4.29, risotto for $3.29, shrimp fried rice for $2.99.

“Dinner for under $10, that’s kind of a running theme,” Bourgeois said.

The company can price its products that way because it buys directly from manufacturers, rather than distributors. It carries unique products it can buy and sell at a reasonable price, even if it means changing the stock week by week.

Customers unsure of whether they’ll like a product needn’t worry — employees will break open a package or pop a bottle top with the asking. Offering such impromptu taste tests is a key part of an employee’s job.

And the workers are preternaturally cheery. The infectiousness starts with the store managers, who are called captains; assistant managers are called first mates.

Also part of the strategy is what you won’t find. Like its ALDI counterpart just down Quaker Lane, there are no coupons, no weekly sales and no loyalty cards.

“We’re not everything to everybody,” said Bourgeois.

The strategy seems to work.

The chain racked up $6.5 billion in sales last year, according to the trade publication Supermarket News.

pgrimald@projo.com

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