Trader Joe's Case Analysis Model

Trader Joe’s Case Analysis

Introduction

This case analysis studies the Trader Joe’s retail chain that operates in the U.S domestic market. It identifies the current competitive strategies being employed by the company, the key issues it faces and proposes a number of improvements that are considered useful for the growth of the company in the future. Trader Joe’s is a privately held company that was founded in 1967 by Joe’s Coulombe and it is presently owned by the Albrecht family trust. Since its establishment, the Company carries out its business using the concept of Fresh & Easy Stores and targets the overeducated and poorly paid customers, who were believed to be sophisticated and interested in finding good bargains (Ager & Roberto,

The factors presented under this model change over time, and they determine the success of the company. The changes are likely to present new opportunities and threats to a company, thus, there is a need for continued evaluation of the industry to ensure that a company exploits the opportunities and protects itself from threats.

Political factors

The political factors in the retail market are associated with the government policies and the political interest groups. In this case, the retail industry operates under high political stability due to democratic elections systems. There is also increased political support for globalization and political pressure for higher wages as the minimum wage requirements are raised (Yüksel, 2012).

Economical Factors

There is a reduction in the rate of unemployment in the United States and stability in the national economy. A reduction in the rates of unemployment has also contributed to the growth of disposables incomes that is held by households. Developing countries are also having continued growth providing an opportunity for retail companies that have an objective of expanding its business internationally (Yüksel,

The two emerging trends in this area include environmentally friendly products and business sustainability. These trends present an opportunity to Trader Joe’s whereby the company should address the ecological factors by improving its operational efficiency using technological innovations. It can also adopt better policies and standards on the products sold in their stores (Yüksel, 2012).

Legal Factors

Legal factors are the various law requirements and regulations that need to be followed in the retail industry. There are the food safety regulations, employment regulation that provides an opportunity. The food safety regulations will help in improving the quality standards of their food products while employment regulations enhance the human resources practices in Trade Joe’s. On the other hand, tax law reforms present a threat since it is likely to lead to higher tax rates (Yüksel, 2012).

Porters Five Forces Model

Threat of new