1 Big Reason for the Success of Trader Joe's
Posted Jun 23, 2023
Joe Coulombe, founder of Trader Joe's, knew without a doubt that paying people well was the most important single business decision he ever made. He recognized that the quality of the people TJ's recruited and retained determined the way the stores were run, which has been key to the grocery chain's success.
If you've been to TJs, you have likely experienced the exceptional way employees take care of customers and how customers are such fans. You may know too that they consistently sell four to six times more per square foot than competitors (read a mini case study in The Amare Wave: Uplift Your Business by Putting Love to Work).
Joe's decision to pay people well is a powerful testament to three common-sense Amare Way principles: 1) treat people well, 2) respect money, and 3) put relationships first. It goes to show how principled love-powered leadership creates incredible business success. Imagine that happening in your organization.
What's your gut reaction to paying people as much as you can?
What beliefs or principles govern how you think about employee compensation?
What's the most important business decision you've ever made?
5 Steps to Decisions About Paying People Well
Get clear on your money beliefs. Complete this sentence: Money is __________. Consider if money serves you or if you serve money. Tune into how being paid well impacts you.
Pay as much as you can. Imagine what positive things might happen, short-term and long-term, if you paid your people not as little as possible, but as much as possible.
Expect resistance. Notice if fears or limiting beliefs come up around paying people as much as possible. Be prepared to respond to others on your team who may be afraid that paying people well will lose you money. Here is a manifesto that can help you.
Do your "magic triangle." Write down three things: a) your core operating assumption about paying people really well, b) the compensating strategy that assumption requires; c) what that strategy makes impossible. Now try changing the core assumption. Go deeper here.
Try on an abundance mindset. Choose to believe that there is enough to go around, and have faith that life conspires to support you and your work. Write it down. Remind yourself often.
Paying people well may be the secret to your organization's success too. Obviously, it can minimize turnover and create long-lasting legacies. The business case, with TJ's being a stellar example, is clear.
Paying people well creates a culture and place that employees and customers alike want to be a part of, naturally leading to growth and lasting success. As a leader, it means you have an abundance mindset and the belief that the more you give, the more you get. Powerful stuff.