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.
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.
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.
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