Aldi Expands from New York to California Lifts USA Annual Rate Store Openings to 130; SimplyNature

On December 20th, privately held German-based retailer Aldi (ALbrect DIscounts) announced plans to open 650 new locations stateside over the next five years at the rate of 130 per year.  That represents 50% of the current number of locations (1300).  The rate per year of 130 is about 50 more than it averaged over the last five years - this new rate of expansion will cost the company $3 billion.  The higher rate of store openings is a result of a renewed interest in California where Aldi will construct its newest major warehouse and will shift its US headquarters to.  Other expansion areas include South Florida, NYC, Washington DC and Houston.

To attract new customers the grocery chain is introducing the new organic private label SimplyNature. Across the Atlantic, in the UK Aldi has been making headlines all year with its record breaking rate of sales growth (averaged over 30% every 12 weeks since late 2012 which compares to 3.5% industrywide).  In December 2013 Aldi's UK market share reached 4.0% for the first time... more on UK Supermarket Share

Aldi differs from the competition in that the focus is on select popular items as opposed to a larger production selection.. selling more of the popular items (1400 items vs 30th at typical supermarket) allows Aldi to offer deeply discounted rates.  Over 90% of items sold at stores are private-label giving the grocer another cost cutting advantage (more control over input costs).  In the UK, it recently increased the number of items in its stores from 800 to 1350.

  • Only about 40% of the company's locations are in Germany
  • Key international markets for  Aldi are i) United Kingdom - 540 stores  ii) USA where stores currently number 1300.
  • Aldi aims to open 50 new UK stores in 2013.  Has between 500 and 600 locations.
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