Traitor Joe's?
Their pita chips taste awfully familiar to the kind at Whole Foods. And that Goddess dressing—I swear that cosmic, flowy-haired woman was on another bottle. Is Joe trying to pass this stuff off as his own? He'd never... No. Would he? Sure enough, Chow reveals that 80% of Joe-San/Josef/Giotto's products are probably produced by a third party. So where does that leave the no-middleman promise? Yikes, his fingers might have been crossed when he said that.
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27 Comments:
Please to re-read their mission statement online. The use of "where possible" and the rest seems to suggest that they are being quite honest with us.
And can we dispense with the joy in attack around here? First Irvine and now Trader Joe's - which doesn't seem to deserve it. Jeez.
Can we please get back to the joy of preparing and eating food? I don't think that is too much to ask.
jpolk at 10:50AM on 03/05/08
am in the TJ's defender camp here and this issue has been needlessly scandalized on Chow and now here on S/E. It's a bit silly. The topic is really interesting and discussion-worthy, though. A lot of people want to know who is manufacturing TJ's products.
So, how was there finger-crossing? Tell me if I'm missing something, but if TJ's sells products directly from the same (or slightly different) production line as name-brand products (i.e. from a manufacturer), the product still only traveled from a manufacturer to TJ's. Further, TJ's assembles and labels their products, right? No wholesaler or retailer seems to be in the mix. No middleman.
I'm disappointed that Chow asserted that TJ's is or may be "in collusion" with name-brand product manufacturers. "Collusion" suggests unlawful fraud or dishonesty. So far from the truth.
Again, noteworthy issues, but why not keep it on the up-n-up?
Susquehanna at 11:05AM on 03/05/08
I don't really think it was a mystery. Most people had speculated that, and it wasn't really a secret. I recall some article talking about how they do search for the best producers of items. There's always going to be some processing involved at any rate.
synaesthesia.dc at 11:07AM on 03/05/08
I always say this; I love TJ's if you think they did anything not to your liking keep shopping at Whole Foods and leave MORE FOR ME!
Nothing I hate worse than getting to TJ's and not finding what I want.
I was there yesterday and everything I wanted was there. YAY!!!
The TJ's brand is no worse than any other grocery store they contract out to get their label on a house brand. Cheaper too.
It is a no-brainer.
JerzeeTomato at 11:16AM on 03/05/08
Pardon the gaffe above, ". . . [n]o retailer seems to be in the mix." TJ's is definately a retailer. The business model seems to be manufacturer to retail, generally, and their prices sure do reflect the absence of wholesale mark-ups.
Susquehanna at 11:21AM on 03/05/08
If you read the TJs sales flyer, they make it clear that they work with manufacturers and food producers to buy up large quantities of stock. This is the biggest "duh" story. Did someone think it's a secret? Did you really believe that TJs had thousands of farms spread across the world, and was producing all of its own products, including the base ingredients? :yawn: Oh, BTW, I have a bridge to see you if you're interested.
For the sake of good journalism, where did Chow get the stat that 80% are probably produced by a third party, and why are you repeating it? Nothing in their article bears out that stat? Though I'd estimate the number's actually closer to 100%.
chgoeditor at 11:30AM on 03/05/08
This is about the same level of breaking news as the Village Voice article a week or two ago that broke the story that Iron Chef American is a produced TV show.
stratusgd at 12:07PM on 03/05/08
Funny, on my last trip to TJ's, I spotted 'their' frozen spinach pie--which is nearly identical to the one I purchase at Costco--and that's what surprised me--it was the exact same packaging (a dark green cardboard container)! Didn't even attempt to make it appear different.
Curlz at 12:33PM on 03/05/08
I didn't think this was a secret. It's that way at Aldi too. Not that you can compare the two. But hardly some big scandal.
aharste at 1:01PM on 03/05/08
Not really a surprise at all. I've always assumed their Goddess dressing was the same as Annie's. And it's pretty widely known among beer geeks that Gordon Biersch brews some of their beers. Even their yearly Vintage Ale bares the Unibroue logo (maker of La Fin du Monde, among others).
slogger at 1:03PM on 03/05/08
if the op on chow hadn't used the word collusion i don't think anyone would have misread this story. they are trying to figure out who is making them, not expose some TJs scandal.
sloppy at 1:14PM on 03/05/08
Food manufacturing today is much more centralized than most people realize. Remember how surprised people were with the pet food recall? That so many brands were coming from the same manufacturing plant? The same thing applies to our (human) food.
My dad was in the food business. Trader Joe's whole business model is to contract with third parties--and squeeze them hard on price.
heidia at 1:25PM on 03/05/08
I thought the whole point behind Trader Joe's was that they'd work with manufacturers and pass the savings down? I've seen plenty of things that are sold at TJ's for a lot more elsewhere, even though it's the same product. See Mini-toasts. See beers, Gordon Biersch.
Wait, why does was this even a post? I thought this was (fairly) common knowledge.
acidspit at 1:40PM on 03/05/08
*edit: why is this even a post.
acidspit at 1:41PM on 03/05/08
This is about six orders of magnitude less of a "revelation" than the VV Iron Chef thing.
Luther at 1:52PM on 03/05/08
@heidia: My dad was not in the food business. Can you clarify what you mean by "squeeze them hard on price"? It sounds unpleasant and perhaps even unethical. If you're getting at Fair Trade issues, there could be something there. I don't know.
Susquehanna at 2:17PM on 03/05/08
This is a shocker? To whom? Did you guys really think that TJ had the capability to manufacture everything from vitamins to dog food, and that they grew all of their own produce? It's called generics, people! It's a house brand! What is the big deal?
I think their approach is that the supply chain from manufacturer to retail is much shorter-there is no wholesaler in the mix. So the food is cheaper and fresher. I fail to see a downside for the consumer.
Moesha at 2:53PM on 03/05/08
As a former employee of one of those contract manufacturers, I saw first hand how Trader Joe's worked. They bought one cheese spread from us with their brand name in addition to one product with one of our own brands. Their approach was to buy a bunch of product at once in cartons with a large number of units to keep costs down.
And if anyone is worried that this somehow compromises their quality, I have this story. The product we made for them was without preservative (potassium sorbate) but we also made versions of the same product for others that included preservatives. Try as we might to keep their product separate, one batch had some trivial carryover of the preservative at a level that was below an effective level but was detected by their quality team. As they should have, they rejected that load but they went the step further of ending our contract because of that one slip.
They were a tough customer when it came to anything quality related.
jfultz at 3:14PM on 03/05/08
This is no secret. Working with manufacturers enables the company to get better prices and sometimes bigger packages. It also allows TJs to have companies produce products to their standards (ex: no chemical preservatives or artificial colors). And yes, of course no middleman/wholesaler.
ulyric at 3:25PM on 03/05/08
I'm confused. Why is this scandalous? Are there people out there who think that stores actually manufacturer and/or package the products they sell under their own label? Seriously? Wow. I honestly thought that everyone (literally) knew that "private label" products were produced by the same companies who make the name-brand stuff. Maybe I'm misunderstanding the issue that makes this so scandalous?
The real problem with TJs is their MO of getting customers hooked on a brand-name product, then reinventing it as a private label product. That wouldn't be so bad, except the price usually does not go down after private labeling (as one might expect), while the product size usually does decrease, so you actually end up paying more per unit than you did when it was name-brand. Also, they like to reformulate, often resulting in a version inferior to the one you got hooked on in the first place.
LoCo at 4:10PM on 03/05/08
@Susquehanna - I didn't mean to make TJ sound unethical--sorry if my comment left that impression. TJ is just known to be tough negotiators with manufacturers on price and quality.
heidia at 4:20PM on 03/05/08
@heidia: No apology necessary. Not such a big deal. Just expressing my confusion and displeasure with all the daggers thrown at TJ's recently.
Susquehanna at 9:04PM on 03/05/08
Go, TJs! Quality stuff, tasty, AND better prices!
OneWallKitchen at 10:42AM on 03/06/08
BREAKING NEWS - Ralph's, Von's, Costco, Safeway all found to be using third parties to produce store brand name items!!!
/sigh
aklectic at 11:51AM on 03/06/08
Simple: Regular Distribution is manufacturer (x% margin)->distributor (30% margin)->Retailer (30-40%Margin). Trader Joes has huge volumes so it goes like this Manufacturer (lower margin than usual)-> Trader Joes. They cut out 30-50% of the margin. Hopefully that helps understand why they contract manufacture.
karstenrobbins at 3:53PM on 03/06/08
This is idiotic. The packaging is usually an obvious tip-off of what product the TJ brand is a twin of - I'm pretty sure they do that on purpose.
Glad to hear they are a tough customer on quality control - thx jfultz.
guido at 8:57AM on 03/07/08
It's no secret that TJs sells private label items made by other companies. They happen to have a high quality standard to match the more reasonable price point. Unlike most shops doing this and placing them alongside brand names, they'll only carry limited varieties of an item. If you want a taste of this on a more budget level, check out ALDI. Yes, the place where you have to pay 25c deposit to use a shopping cart. They're about the most fantastic low end supermarket ever. No frills, mostly private label, and unbeatable prices. Same great satisfaction guarantee as TJs. I miss their $1.69 monster box of Frosted Mini Wheats dearly. And guess what - ALDI owns TJs.
jraphs at 10:25AM on 03/08/08