This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Should Whole Foods Buy Trader Joe's?

Stocks in this article: WFM SBUX AMZN AAPL SWY

NEW YORK ( TheStreet) -- I'm watching Howard Schultz build an empire at Starbucks (SBUX). Outside of Apple (AAPL) and (AMZN), there's not another company -- across spaces -- doing what Starbucks does, as well as it does.

Starbucks is a tech company in a retail coffeehouse's clothing. At first blush, you might place them on the same level as Whole Foods Market (WFM), but Starbucks really is the superior company for the long-term.

On most days, I have nothing even remotely negative to say about Whole Foods from consumer and investor perspectives. Love the company. Really like the stock. However, when I conduct a multi-method stock market ethnography that puts Starbucks and Whole Foods side-by-side, I start to see flaws. Let's explore them over a bottle of Cherry Chia Kombucha and a venti Chai Tea Misto, 1/4 hot water, 3/4 steamed soy milk, plenty of foam.

We'll get to the all-important Trader Joe's stream of semi-consciousness in a minute, but Starbucks doesn't dominate because of scale and size; it wins because it's cutting edge.


Thanks to TheStreet's Robert Weinstein, I got my hands on a Starbucks Steel Gift Card. This is the premium-quality SBUX card, loaded with $400 and on sale for $450 in a limited quantity of 5,000. They sold out in minutes. And now, they're popping up on Ebay for outrageous prices with a majority of the actual bids coming in as high as $700 to $800.

I was thrilled to get my hands on one. As a relatively new Starbucks addict, I'm grateful to Robert. Why is this relevant? It's relevant because the Starbucks iPhone app I downloaded a few months ago has made me a loyal customer. I hit Starbucks at least once a day now; sometimes twice.

The app got me in the door. Combined with friendly baristas and a solid drink, it keeps me coming back. Talk about driving engagement. That's exactly what the app does. It's exactly what Starbucks intended it to do. It's brilliant. Play with the app. If you don't walk away with a better understanding of what I mean by Starbucks is a tech company you're not taking the papers.

Whole Foods needs to do something like this. The standard Whole Foods customer, at least in my neck of the woods, is the typical Starbucks customer. They're tech-savvy, iPhone-toting modern-day yuppies who already have or are starting to have guppies. Playing with an app in a grocery store is the ultimate diversion from the everyday monotony of life.

1 of 3

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs