Why do you think people still identify you with the chain, rather than the German owners?
But you didn't do the hard sell?
No, no, it was "If you don't buy this, it's all right, we've signed 30-year leases." On the other hand, if you don't buy it, it may be gone pretty soon.
This was one of my most important principles: Never have a mandatory sell. This rule gets violated all the time; it just drives me nuts: "Buy now!" You never give an order to a customer.
When I was selling Kirby vacuum cleaners at Stanford door to door, that's where I learned negative selling. You go in and say, "Well, I really don't think you can afford this." Sometimes they did buy; you don't make a sale on every call.
Why was a German company interested in buying Trader Joe's?
In those days, the average store size was about the same as their Aldi [markets]. I dissuaded them from using Trader Joe's as a vehicle to launch Aldi. Pretty soon they came to realize that Trader Joe's was a unique vehicle. They've been wonderful owners. We had in essence a one-page agreement. O'Melveny & Myers refused to write it! So my lawyer did. You can't have a one-page agreement today.
If I were to go into your kitchen now, would I find a lot of Trader Joe's stuff?
I buy Trader Joe's mayonnaise. I do a lot of shopping at Costco, and at Cost Plus [whose board he chairs].
Was there a real Charles T. Shaw, of two-buck Chuck fame?
Oh yes. He was a banker who went to work in Paris; fell in love with Beaujolais. I met him once, in the 1980s. He had a winery in the Napa Valley. Went bankrupt. And Fred Franzia, the largest owner of vineyards in the United States, he bought the name, he bought the brand.
I tell people, on every case there's not only a date, there's an hour code. Write that down and if you like that bottle, go back and try to find the same date and hour. [The wine] will vary tremendously because of the volume -- 6 million cases or whatever it is a year. It is discontinuous; you cannot count that next month your Charles T. Shaw Cabernet Sauvignon will taste same as the last one.
Trader Joe's had nectarines from Chile, noodles from Thailand. Now we're concerned with carbon footprints and locally grown foods.
An article in the New York Times said that in the recession, the green pitch isn't working anymore and organic sales have fallen sharply. I've always felt the whole organic idea was a fraud. There are some very legalistic definitions [to organic]. It's one thing to have organics, and it's another thing to avoid certain additives like extra sugar and flavor enhancers and artificial colors. That's what we were doing.
And the private label?
We didn't inaugurate it; we changed its character. There are a lot of products which have no branding. We put our name on it. We were the first essentially to sell frozen fish. We went down to San Pedro and we'd buy it and freeze it and it was a huge success. If you want really fresh seafood, buy it frozen -- if it has been frozen the minute it hits the deck.
People talk about L.A.'s restaurants changing the city's tastes, but few people go to those restaurants and many go to Trader Joe's and see an Indian dish or a Peruvian dish and think, well, for four bucks, I'll try that.
Some of changing [people's taste] was simply by breaking the price on things that had been too expensive. Wild rice -- we found that farmers around Sacramento were starting to grow wild rice, and we broke the price on wild rice. And supermarkets didn't pay any attention to capers -- we broke the price on capers. Supermarkets don't have the imagination, and that's OK, because they're trying to be all things to all people.