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How sustainable is Trader Joe’s business model?

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MARCH 16, 2021

You enter your local Hawaiian-themed grocery store to pick up your weekly essentials. Making your way through the eclectic art decor, you find yourself overstimulated by the colorful hand-drawn labels and crafty packaging. You’re transported across continents with microwave-ready, mouth-watering meals and spreads from tikka masalas to tamales, with gluten-free and vegan options galore. Indulging in your urges, you fill up your cart with all that you desire knowing that despite the physical struggle it will take to carry it back home, your wallet has not suffered at your expense.

Trader Joe’s, or TJ, is a franchise that has gained a reputation among customers as a local, healthy and “eco-friendly” joint. With only a brief statement in the FAQ section of the website disclosing that labeled items include no artificial flavors, artificial preservatives, MSG, GMO or partially hydrogenated oils, information on where and how the food is sourced is surprisingly not available. With the rise of environmentally conscious consumers, disclosing information about the processes of food production and ingredient outsourcing is increasingly important — beyond the quality of food, labor practices and environmental concerns are crucial factors in determining companies’ sustainability.

Transparency around production and manufacturing processes has historically been an issue for TJ. Multiple food journalism networks have revealed that many mainstream brands such as PepsiCo have been selling their items under the TJ label for years. With much ambiguity around the manufacturing and production process of TJ goods as well as a lack of sustainability reports published by the company, the question we must ask is how environmentally sustainable is Trader Joe’s business model?

Many environmental organizations have determined issues within the business model that diminish claims of sustainability. TJ has a low score on the Climate-Friendly Supermarket Scorecard, which is an indicator based on actions taken by supermarkets to reduce emissions of hydrofluorocarbons, or HFCs, from refrigerants, a major contributor to climate change and ozone depletion. Refrigerant leakages forced TJ into a settlement with the Environmental Protection Agency and the Department of Justice in 2016 for violations of the Clean Air Act. TJ’s current score reflects a lack of action taken by the company to publish information regarding refrigerant emissions publicly and to reduce their overall footprint.

Moreover, TJ has a very low score on Green America’s Chocolate Retailer Scorecard, which rates retailers based on actions taken to address child labor abuses and deforestation in the cocoa industry. As a retailer of chocolate products, it’s important for TJ to be transparent about where their cocoa is sourced and whether these farms are using Child Labor Monitoring and Remediation Systems. The campaign Don’t Discount Our Future, Trader Joe’s, founded by the nonprofit Environmental Investigation Agency and Green America, hopes to bring attention to these issues by advocating for consumer-based strategies that pressure TJ into transparency.

Beyond these indicators, plastic packaging has always been a major issue with TJ products. While the company did make changes in 2019 to reduce plastic packaging, large amounts of plastic can still be seen wrapped around produce and to-go meals: Numerous petitions continue to call for TJ to reduce plastic packaging and create bulk bins for produce.

A quick survey of the products offered at Trader Joe’s suggests many kinds of cheese, condiments, nuts and dried fruits could be imported from countries including Italy, Turkey and Australia. With the store’s “mom and pop” feel, the substantial amount of imported products can be easily overlooked — unfortunately, so can the large carbon cost of transporting these goods. Importing goods from overseas contributes immensely to climate change as the aviation industry produces 2% of carbon dioxide emissions, making carbon costs of shipping a major issue as imported products become staples.

While there is still much discussion over whether sustainability regulation should be mandated or voluntary, sustainability regulation of small- to medium-sized companies is seriously lacking, making it harder to estimate the environmental and social impact of these businesses. In the United States, the forms of mandatory sustainability reporting on environmental and ethical impacts are only enforced for a list of larger companies and corporations by the Securities and Exchange Commission as well as the New York Stock Exchange. Many corporations do not fall on these lists, including successful retailers such as TJ.

More policy on business sustainability and transparency needs to be put forth, especially by the Department of Agriculture, mandating small- to medium-sized companies to release annual sustainability reports analyzing the impact of their business practices and model. Shifts in consumer choices and awareness campaigns to modify aspects of TJ’s business model are great achievements. However, wide-scale change can only be propelled by advocating for federal policy changes that hold businesses accountable for their impact locally and globally.

Corporations and businesses are sources of unregulated power within society that influence the political, social and environmental domain that they profit from. These businesses are not just limited to companies that hold control over massive industries and resources but also include the storefronts of our own beloved “local” markets and grocery stores. As consumers, we need to question the food systems we rely on and further advocate for change at both the industry and federal levels.

Hawraa Safar is an undergraduate student at UC Berkeley with an immense love for Trader Joe’s yet a critical eye for environmental impacts of mass consumerism and corporate greed.

MARCH 16, 2021

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