Aldi
The German based discount supermarket Aldi, the tenth largest retailer in the world with over 7,000 stores have reported sales growth for the past year dipping below 20% despite a massive growth in food sales. Non food sales are slowing says Aldi managing director Paul Foley, but food sales remain strong, comfortably outperforming rivals including Tesco who have re introduced their own range of discount brands.
In the UK, Aldi have seen sales soaring as consumers have become more price conscious, sending sales soaring by 25% in 2008 to £2.15bn. However sales of non-food items, the Aldi ‘Special Buy’ items that have historically made up one fifth of the company turnover, are currently in decline in line with most ‘luxury’ goods markets.
“This is not an easy climate to persuade people to buy a new television, a new water butt, a new wheelbarrow. People are in the mode at the moment of thinking the old one’s OK.” says Foley.
Aldi plans to increase the number of retail units in the UK and Ireland at the rate of 40 to 50 stores a year, with an ultimate goal of 1,500 outlets, from the current figure of 457. Discount retailers in Germany account for 40% of the grocery market and while Foley predicts that the UK market will never reach that figure he does see the possibility of reaching 20% in the long term.
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