SWOT Analysis of
Trader Joe’s
Ryan Mallory
1/13/23
Executive Summary
• The Current State of Trader Joe’s
• General Strategy: Differentiation
• Expand domestically and internationally
• Pay Attention to the Macroenvironment
Background of Trader Joe’s
• History of the Organization
• Products and Services Offered
• Markets Served
Internal Strengths
• Reputation of excellent customer service
• High quality products
• Sales Per Square Foot
• Efficient Supply Chain
Internal Weaknesses
• Limited Products
• Absence of eCommerce
• No international stores, many states with few/no stores
• Minimal advertising
External Opportunities
• Increase advertising
• Expand to international market
• Increase variety of everyday grocery items
• Open stores in high demand areas around the country
External Threats
• Rising cost of labor
• Competition from other grocery chains
• Demand for technological advancement
• Demand for environmentally-friendly practices
Macro Environmental Analysis:
PESTEL
• Political
• Economic
• Social
• Technological
• Environmental
• Legal
Micro Industry Analysis: Porter’s
Five Forces
• Threat of New Entrants
• Threat of Substitutes
• Supplier Power
• Buyer Power
• Industry Rivalry
Generic Strategy
Recommendations
• Differentiation is a winning strategy
• Continue to expand
• Focus on introducing more “staple” items
Organizational Design
Recommendations
• Fit between strategy and structure
• Stay on top of macroenvironmental shifts
Ethical Considerations
• Safety and physical wellbeing of employees
• Sustainable packaging
• Competitive wages and benefits
References
About Us. Trader Joe's. (n.d.). Retrieved January 14, 2023, from
https://www.traderjoes.com/home/about-us
Adams, Holden G., "Trader Joe’s: A Case Analysis of Trader Joe's Competitive Strategy" (2020).
Honors Theses, University of Nebraska-Lincoln. 283.
https://digitalcommons.unl.edu/honorstheses/283
Felsted, A., & Halzack, S. (2020, August 22). Analysis | the future of trader joe's looks bumpy. The
Washington Post. Retrieved January 14, 2023, from
https://www.washingtonpost.com/business/the-future-of-trader-joes-looksbumpy/2020/08/21/d3803f10-e38c-11ea-82d8-5e55d47e90ca_story.html
Bright, D. S., Cortes, A. H., & Hartmann, E. (2019). Principles of Management. O penstax.org. Openstax.
Retrieved January 13, 2023, from https://openstax.org/details/books/principlesmanagement?Book%20details.
Myers, D. (2014, April 17). The history of Trader Joe's. The Daily Meal. Retrieved January 14, 2023, from
https://www.thedailymeal.com/history-trader-joes/41714
R, R. K. (2021, September 19). Trader Joe's business model of "Less is more". The Strategy Story.
Retrieved January 14, 2023, from https://thestrategystory.com/2021/09/19/trader-joesbusiness-model/
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