Don Kohles, 91, was walking into the supermarket when he saw a vehicle being chased by police crash into a pole just outside. Others emerged from second-floor windows and climbed down ladders that had been propped up along walls by police.
Five store shooting victims, including a 12-year-old boy, were transported to a hospital.
Officers tracked the auto using a stolen-vehicle tracking system and tried to stop the man in Hollywood, but he refused to pull over.
Lynne Westafer, a KCBS-TV news producer, was one of those people inside the store.
"Our thoughts are with her family, and our Crew Members and customers who experienced this terrifying and unimaginable ordeal", the statement said.
Armed officers stormed the outlet and pushed towards the back of the store where the suspected had barricaded himself in a separate room.
Police tracked the vehicle using a built-in anti-theft system, locating the Camry in the Hollywood area of Los Angeles - just west of the Silver Lake neighborhood where the chase came to a violent conclusion, according to multiple accounts, including one by The Associated Press.
He asked that he put handcuffs on himself before leaving the shop.
The violence began when Atkins shot his 76-year-old grandmother several times at their South Los Angeles home after she complained about his having too many television sets on, said a cousin, Charlene Egland.
Authorities say earlier Saturday he shot his grandmother seven times and wounded another woman, who he forced into a auto. According to a report by The San Bernardino Sun newspaper on Sunday morning, police are still uncertain as to the exact circumstances of Corado's shooting.
Police Chief Michael Moore said the suspect shot his grandmother seven times.
"Then this guy comes out of the auto and starts running toward TJs", 91-year-old witness Don Kohles told CNN, referring to the grocery store.
A man's feud with his grandmother turned into a weird and deadly confrontation that ended with a supermarket worker dead and dozens of people held hostage in a store miles away.
Los Angeles Mayor Eric Garcetti said the women was killed inside the Trader Joe's store in the Silver Lake area. Officials said they had 18 ambulances and 100 firefighters staged at the scene.
Police at the scene said a number of people inside the store were held against their will for three hours. All were in fair condition with no life-threatening injuries, a spokeswoman said.
A Trader Joe's employee is dead and a wounded suspect is in custody after a standoff in Los Angeles stretched over several tense hours Saturday before the gunman's surrender. At one point, he opened fired on officers from the vehicle, shattering his back window. "She was flawless. She was what Trader Joe's was about". The grandmother was hospitalized in critical condition on Sunday.
Sgt. Barry Montgomery said the situation was still unfolding but officers were communicating with the suspect.