Leadership Lessons from Joe Coulombe’s “Becoming Trader Joe”

Every quarter, the Barrel partners read a book together. We spend a portion of our quarterly session discussing the takeaways and how they apply to running an agency and our lives. These books have shaped how we think, collaborate, and show up as leaders. I am grateful for the many deep discussions and takeaways from years of reading together. If you're interested, Barrel CEO Peter Kang keeps a running list of these books on his blog.

To prepare for our Q3 2022 session, we read Becoming Trader Joe, a memoir by Trader Joe's founder Joe Coulombe. My wife Dana and I became fans of Trader Joe's after moving to Brooklyn. It was always a treat to visit, but it seemed like the line was out the door anytime we went. We would often wait it out anyway, anxious to bring home the various items we knew we could not get anywhere else.

Since moving to PA, we have been happy to find that Trader Joe's is not packed like it was in NYC, making visits much more relaxing. Years ago, I took my Mom-Mom to a local Trader Joe's for her first time. Like a kid in a candy shop, she filled her cart to the brim. It seems like just about every customer who enters its doors is captivated by what it offers.

I have always been intrigued by Trader Joe's, so I was excited to dig into Joe Coulombe's memoir. I hoped to learn more about the founding story and what makes Trader Joe's so special today. Turns out, that special quality comes from Joe's leadership and unique ideas.

In the book, Joe shares the journey of creating the Trader Joe's we know and love today, touching on lessons learned building a business and leading a team. On the business side, Joe outlines several concepts (limited SKU offering, private label products, virtual distribution, SKU-level profit) that the Barrel partners and I had fun applying to our experience running the agency. However, my focus for this post is five of my favorite leadership lessons from Joe.

Leadership Lessons

1) Make sure your troops know your plan.

"If you want to know what differentiates me from most managers, that’s it. From the beginning ... I’ve been aware of the need to sell everybody. That’s why, throughout my career, my policy has been full disclosure to employees about the true state of our affairs, almost to the point of imprudence. I took a cue from General Patton, who thought that the greatest danger was not that the enemy would learn his plans, but that his own troops would not."

Between new agencies emerging and technology evolving every day, it can be easy to get distracted and focus on the wrong things. While staying competitive is important, Joe reminds us that we won't get anywhere without our team on board with our vision and plan. As a manager, I look at selling as being honest with the team, explaining the big picture and necessary context, asking for their input, and working with them to shape the path forward.

2) Listen at lower levels.

"This is one of the most important things I can impart: in any troubled company the people at lower levels know what ought to be done in terms of day-to-day operations. If you just ask them, you can find answers."

This excerpt reminded me of how we recently evolved our quarterly debrief process to include thoughts and feedback from every team member. Although I get pretty close to the day-to-day at times, I know that the team has the most exposure to what is working and not working.

In the past, we have rolled out changes without exploring with the team first. Sometimes, they stick; other times, they fall apart. I've learned how important it is to create space to hear from the team and listen to their ideas as we aim to improve how we function as an agency.

3) Don't wait for an optimum solution.

"I concluded that I didn’t have to find an optimum solution to Pronto’s difficulties, just a reasonable one. Trying to find an optimum solution in business is a waste of time: the factors in the equation are changing all the time."

I could not agree more with this mindset. No matter how far we project into the future, decisions we make now are bound to look different in the future, for better or worse. It is not worth losing time searching for the perfect solution because you never know what the current reality will look like later. Instead, the Barrel partners and I have found that the best thing we can do is stick to our principles, work with the facts, and make decisions we can get behind. The same goes for how I approach my life and role as a CXO.

4) Impact takes time.

"When I announced my resignation to the troops in July 1988, I told them that the real measure of my ability as a manager would come about two years after I left."

It can be challenging to be patient with progress when I can see the vision for the future and know that the team is hungry for change. Joe's insight was a welcome reminder that it takes time to create a lasting impact. In his situation, that meant seeing how the systems he had built played out after his departure in 1988.

Rather than get frustrated and impatient, I've tried to focus my energy on casting vision further into the future and looking at what seemingly small steps we can take today that will add up to big strides down the line.

There's also a lesson here about the role of a leader, more specifically a manager, on a team. They are there to uplift the team and help them be effective, not for rewards or accolades. In that way, it's about the systems and frameworks they put in place that can make an impact for years to come. There's a great excerpt from the book "The Motive" by Patrick Lencioni that touches on this topic:

"At the most fundamental level, there are only two motives that drive people to become a leader. First, they want to serve others, to do whatever is necessary to bring about something good for the people they lead. They understand that sacrifice and suffering are inevitable in this… ... The second basic reason why people choose to be a leader—the all-too-common but invalid one—is that they want to be rewarded. They see leadership as the prize for years of hard work and are drawn…"

5) Don't be afraid to experiment. Let your principles and priorities be the guide.

Throughout his memoir, Joe shares several initiatives from his time building Trader Joe's. Examples include targeting profit (in dollars) for every available SKU, writing White Papers to explore his plans in detail to creating the Fearless Flyer, an iconic newsletter for Trader Joe's customers.

With every initiative, it was clear that Joe operated from a set of principles and priorities. Whether he decided to pay his people well or his promise to what he deemed an "overeducated, underpaid" audience, he, in essence, created a set of guidelines that allowed the team to operate with speed, navigate difficult times, and generate new ideas.

I admire this about Joe's career. It got me thinking about my transition into the CXO role and how getting clear on my principles and priorities in the role has helped me better lead the team.

In Closing

Around 1977, Joe faced uncertainty around changes in government (taxes, regulations, etc) that could impact his personal life and business. He weighed the risk of selling Trader Joe's and in 1979, sold to the Albrecht's, the family behind the Aldi (an acronym for Albrecht Discount) grocery chain. He stayed on for another ten years until 1989.

In Joe's words, his "post de-partum life can be broken into three categories: running companies in terrible trouble; consulting for companies in terrible trouble; and serving on boards of directors, some troubled, some not, which is my current occupation."

Toward the end of his memoir, Joe reflects on his decision to leave Trader Joe's behind:

"Do I regret having quit? No. The succeeding ten years were so full of fascinating experiences that I am glad I exited. ... But do I regret having sold? Yes. I admit it. To mine own self I was not true when I sold. I regret not having had the guts to ride out the loss of the surtax exemptions, the employee ownership problem, the threat of death taxes, Carter’s threat to eliminate capital gains preference, and all the other fears, real or phantom, of late 1978. ... I have to admit the truth, that I regret having sold Trader Joe’s. And I have had to pay something for this, beyond the loss of my shadow. Thanks for listening, Joe Coulombe."

I remember my heart sinking as I read these last few lines. I have no idea how it felt to be in Joe's situation, but I know what it feels like to weigh the risks of a business decision and take a bet on your ability to see it through. Reflecting on Joe's regret gave me momentum to keep charging ahead and charting vision for Barrel's future.

I'll end with this quote from "Zen and the Art of Motorcycle Maintenance" by Robert M. Pirsig:

"Mountains should be climbed with as little effort as possible and without desire. The reality of your own nature should determine the speed. If you become restless, speed up. If you become winded, slow down. You climb the mountain in an equilibrium between restlessness and exhaustion. Then, when you’re no longer thinking ahead, each footstep isn’t just a means to an end but a unique event in itself."

Through all of ups and downs so far and the inevitable bumps ahead, Joe's story reminded me to keep the faith, believe in myself and the team, and most importantly, find a good rhythm with every footstep as we climb together.