ALDI Scores Big Market Share in the U.S., UK and Europe with its Discount Supermarkets and Aggressive Investment/Walmart Dominates Grocery Retailing

Supermarkets like Kroger, along with the grocery departments in superstores like Walmart, are the predominant way that consumers get their groceries and household supplies in the U.S. and many other developed nations, with each store deeply stocked with essentially the same items, largely sold under national brand names, but also competing with each chain’s own store brands. However, German-based, privately-owned ALDI Group (ALDI stands for Albrecht Discounts) has proven that supermarkets don’t have to be so “super” in size or in depth of merchandise in order to satisfy shoppers. The firm can trace its roots back to 1913 to a small family run store in Essen, Germany. Today, ALDI operates a chain of discount grocery stores in Europe, the UK, Australia and the U.S. It is one of the fastest growing retailers in the U.S., with about 2,400 stores by the end of 2024. ALDI's strategy is unique. The company specializes in offering a limited assortment of private-label merchandise (about 90% of its items are ALDI branded), carrying approximately 1,650 deeply discounted household and grocery items in each store, compared to the average 30,000 to 50,000 items offered by traditional supermarkets. This is very similar to the merchandising strategy used with great success by Costco, the U.S.-based warehouse club that stocks 80% to 90% fewer items than its competitors.

At only 12,000 square feet each, the stores are roughly 75% smaller than a typical supermarket. The highly efficient new U.S. stores can run with as few as six employees on duty at a time. ALDI maintains low prices through aggressive cost-cutting programs; foregoing lavish in-store displays; complicated labor-intense departments like floral or deli; bagging clerks; customer loyalty cards; or free grocery bags. The firm also owns the highly successful American chain of Trader Joe's specialty supermarkets. In Germany, the firm controls 40% of the grocery market through its ALDI Nord (North) and ALDI Sud (South) stores. In Austria and Slovenia, stores operate under the Hofer name. The company has approximately 12,000 stores worldwide, as of the end of 2024.

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ALDI Scores Big Market Share in the U.S., UK and Europe with its Discount Supermarkets and Aggressive Investment/Walmart Dominates Grocery Retailing, Business and Industry Trends Analysis

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