Trader Joe's reveals why it still refuses to offer grocery pickup or delivery, even as fans beg the chain for online options
Trader Joe's has avoided offering delivery or pick-up orders for decades.
The added cost of those options is the main reason why, according to the company's podcast.
Grocers from Amazon to Aldi have built warehouses or worked with startups to offer groceries online.
You can get groceries from just about any store delivered to your doorstep these days — except from Trader Joe's.
The grocer has abstained from any sort of delivery or pick-up service, even as other supermarket chains, from Kroger to Whole Foods to Aldi, have developed their own online grocery option or worked with a third party like Instacart to provide the option.
The reason? According to an episode of Trader Joe's podcast, released on Monday: A combination of cost and company culture.
Trader Joe's is focused on running brick-and-mortar stores, Matt Sloan, one of the podcast's hosts and a top employee in the grocer's marketing department, said on the episode. Trader Joe's wants to be "a real place, with real people, buying real products," he said.
In a physical store, customers can roam around, buying what they need while also happening upon new items, co-host Tara Miller, Trader Joe's vice president of marketing, said in the episode.
"That experience would not be the same if you were trying to order something from a website that just showed you the products you already know about," Miller said.
But delivering to customers' homes, or arranging orders for pickup, is also expensive, Sloan and Miller said.
Trader Joe's shoppers have been asking for the chain to provide delivery for years. Some have even turned to local personal shoppers or third-party websites that claim to deliver from the grocer, and early in the pandemic someone started a online petition seeking pick-up and delivery options
Rivals' online grocery options
Amazon has spent years, and billions of dollars, trying to perfect its grocery strategy. Delivery and pick-up is a key part of that effort, with the e-commerce giant upping fees on deliveries to Prime customers and incentivizing them to pick up orders in-store with a discount.
Walmart has also expanded its grocery delivery capabilities, hiring drivers and offering unlimited deliveries for members of its own subscription program. Kroger, meanwhile, is five years into a partnership with UK-based online grocer Ocado and has constructed several robot-powered warehouses dedicated to filling online orders.
"Somewhere in the chain there are costs involved with ordering things online, shipping things to your door, with trucks and warehouses that are dedicated to not servicing a store location, which services a lot of people, but servicing individual homes where products get delivered," Miller said.
Many players have pitched themselves as "disruptors" in the grocery market, Sloan said during the podcast. "And what I think they've really upset is people's understanding that there are actual costs from each of those things, and all of that work combined, meaning that free shipping doesn't really exist," he added.
"There are always going to be costs associated with running a business," Miller said. "We prefer that those costs be people."
Avoiding delivery and pick-up is just one way that Trader Joe's has kept its costs low. The chain also relies on its own-branded products and runs stores that are smaller than most supermarkets to minimize expenses.
"We have a simple and focused format: We don't have secretaries because everyone should be supporting the company, not someone else," CEO Dan Bane said in 2007. Bane, who came up with the idea of selling bananas individually for 19 cents instead of by the pound, is planning to retire this summer, Trader Joe's announced earlier this week.
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