A historical past of Dealer Joe’s and Joe Coulombe, the person behind the model

Joe Coulombe, a struggling comfort retailer proprietor in Los Angeles, determined in 1967 to open a grocery chain to enchantment to the small however rising variety of well-educated, well-traveled shoppers that mainstream supermarkets have been ignoring.

“I’ve an excellent viewers in thoughts,” he informed the Los Angeles Instances in 1981. “This can be a one who received a Fulbright scholarship, went to Europe for a few years and developed a style for one thing apart from Velveeta” peculiar beer and Folgers espresso, he mentioned.

Coulombe acknowledged that worldwide journey was about to blow up due to the brand new Boeing 747 hitting the market. For the title of his new retailer, Coulombe landed on Dealer Joe’s to evoke unique pictures of the South Seas. The title was impressed by Dealer Vic’s, a well-liked Tiki Bar restaurant began in California.

One advertising and marketing professional thought it was a horrible title — “Dealer” was “one thing related to promoting faulty horse flesh,” Coulombe mentioned in his memoir, “Changing into Dealer Joe,” revealed in 2021, a yr after he died at age 89.

But it surely caught, and the primary Dealer Joe’s opened in Pasadena, California, in 1967. The situation was excellent for his new goal buyer, surrounded by faculty campuses, a hospital and massive engineering companies.

“He was a grocery outsider who was capable of see issues otherwise,” mentioned Benjamin Lorr, writer of “The Secret Lifetime of Groceries: The Darkish Miracle of the American Grocery store.” “He wished to faucet into this concept that meals was exploration, that meals was journey and journey.”

Nautical theme

The primary Dealer Joe’s retailer had a nautical theme with marine artifacts together with a ship’s bell, fish netting and half of a rowboat. The try counter was an island with a roof. Workers wore Polynesian shirts and Bermuda shorts. The supervisor was known as captain and the assistant was first mate. And lilting Hawaiian music performed over the loudspeakers.

However the merchandise appeared nothing like what you’d discover at a Dealer Joe’s right now.

The unique retailer had a typical comfort store assortment of groceries, together with discounted magazines, books, socks and hosiery, data and picture ending. The massive draw, nonetheless, was the alcohol choice.

California had Honest Commerce legal guidelines on alcohol, so producers set minimal costs and it was unlawful to go beneath them. Since Coulombe could not compete by providing low costs, he acknowledged he needed to provide all kinds to face out.

The primary Dealer Joe’s boasted of getting the world’s largest assortment of alcohol — 100 manufacturers of Scotch, 50 manufacturers of bourbon and gin and 14 varieties of tequila.

Coulombe ultimately discovered a loophole in California’s Honest Commerce legal guidelines that allowed his store to import high-end French wine and promote it for decrease costs than opponents, serving to him attain wine connoisseurs. (It will not be till years later that Dealer Joe’s launched its well-known $1.99 Charles Shaw wine, often called “Two-Buck Chuck.”)

Well being craze

By the early Seventies, Coulombe seized on the rising well being meals motion, believing it could enchantment to the identical kind of shoppers who additionally occurred to be wine connoisseurs.

“His concepts on advertising and marketing groceries got here from his advertising and marketing of wine,” Benjamin Lorr mentioned.

Dealer Joe’s first private-label product was granola, after which it began including recent squeezed orange juice, nutritional vitamins, nuts and dried meals and cheese. At one level, Dealer Joe’s was the most important US importer of brie.

Coulombe turned immersed within the well being meals tradition in Berkeley and San Francisco.

“I employed a younger hippie lady out of the College of California at Santa Cruz to show us the lingo,” he mentioned.

Brandenburg Brownies and Sir Issac Newtons

In 1977, Coulombe remade Dealer Joe’s once more — setting it on a path that will be extra acquainted to right now’s clients.

In response to the finish of Honest Commerce legal guidelines on alcohol in California and different value controls, Dealer Joe’s wanted new methods to develop revenue and keep aggressive. It eradicated most family fundamentals and cleansing necessities and targeted on meals. It additionally slashed the variety of objects it carried and moved to largely promoting private-label objects.

“As we advanced Dealer Joe’s, its biggest departure from the norm wasn’t its measurement or its decor,” Coulombe mentioned. “It was our dedication to product information, one thing which was completely international to the mass-merchant tradition, and our turning our backs to branded merchandise.”

The corporate even positioned its private-label names and branding to attach with well-educated customers — Brandenburg Brownies and Sir Issac Newtons, for instance — Coulombe mentioned.

Creating sturdy private-label choices to rival nationwide manufacturers could be one in every of his legacies within the grocery store business, mentioned Lorr. “That modified the steadiness of the grocery business. Abruptly, grocers are empowered in a approach they weren’t.”

However Coulombe resisted opening up dozens of latest shops.

Trader Joe's has more than 500 stores across the United States today.

The handful of shops Coulombe did open have been in Southern California, which match the demographic profile he was searching for — lecturers, musicians, journalists and different professionals.

In 1979, Coulombe bought Dealer Joe’s to the household of Theo Albrecht, then the proprietor of the Aldi grocery chain in Europe. (Aldi in the US is individually owned by the household of Theo Albrecht’s brother Karl.)

Aldi executives would journey from Germany to go to Dealer Joe’s about every year, however they took a hands-off method to overseeing the rising chain.

By the point Coulombe stepped down as chief government in 1988, Dealer Joe’s had 27 California shops and an estimated $150 million in gross sales.

It will be his successor as chief government, John Shields, a former fraternity brother at Stanford, who led Dealer Joe’s out of California and turned it right into a nationwide chain. In 1996, Dealer Joe’s opened its first two shops on the East Coast, each in Boston suburbs.
By 2020, Dealer Joe’s had greater than 530 shops and an estimated $16.5 billion in gross sales, in line with the newest information obtainable from Grocery store Information.

“My successors at Dealer Joe’s have taken a 30-store chain nationwide with exceptional adherence to the fundamental ideas we began out with,” Coulombe mentioned in 2010.