Inflation leads to sales of supermarkets with German soul


Lidl and Aldi are consolidated thanks to the traditional ‘higher quality at the lowest price’ recipe and their ability to adapt to the national customer

In the 1990s and early 2000s, the major German distribution companies landed in Spain with cube-shaped supermarkets and surprising products. There was a new supermarket concept, the ‘discounter’, based on low prices, which the consumer of the time saw almost as something exotic. During the early years, customers appreciated their cheeses, their yogurts, their chocolates or their bazaars (tools and toys in a supermarket, something that had never been seen before), but few families made their entire purchases in these establishments. 28 years after the arrival of Lidl and 20 after the landing of Aldi in Spain, inflation is changing consumer habits, which are becoming more and more demanding, and these supermarkets have adapted: they keep their German DNA, but they are ‘integrated’ into the Spanish customs, and therein lies the renewed success.

German discounters continue to gain market share, buyers and regularity. Lidl was consolidated in 2021 as the chain that has grown the most in the two years of the pandemic and as the second company with the most customers, after Mercadona; two out of three Spaniards (65%) buy from their establishments. Meanwhile, Aldi is the chain that attracts the most new buyers and is visited by one in three families, according to the latest ‘Balance of Distribution’ report from data company Kantar.

In an industry where getting a dollar costs sweat drops, Lild and Aldi share an optimistic view. Inflation and uncertainty due to the economic situation are forcing consumers to optimize their budget, and this is precisely the strong point of German supermarkets, which are launching expansion plans. Lidl, with 650 stores, 11 logistics platforms and a workforce of more than 17,500 employees in Spain, plans to open 40 new branches and a new logistics platform this year in Nanclares de Oca (Álava), while Aldi, with 370 supermarkets, it will open 50 more in 2022.

The old recipe of ‘higher quality at the best price’ remains the main attraction of these companies, but in recent years the evolution of the sector and the demands of customers, who now value product quality and ecology more, but who also keep a close eye on promotions and offers, have brought more fresh, local, private label and even vegan products to the distribution shelf. “We want to improve the customer’s shopping experience and integrate sustainability throughout the value chain to generate a positive impact on the environments in which we perform our work,” they say at Lidl, where they have proposed to reduce plastic and use it responsibly. of it in the package.

The distinctly German character of these distribution companies in their beginnings in Spain mutates more and more until it camouflages with their country of origin, a trait both companies maintain, which already feels more Spanish than German. «More than 70% of our range comes from Spanish suppliers, but not only that: we are a strong promoter of the ‘Marca España’ outside our country. The fact that we have a network of more than 11,500 stores in thirty countries has consolidated us as one of the most important export platforms in the Spanish agri-food sector. Since our arrival in Spain, we have acquired a national product worth more than EUR 50,000 million,” explained Lidl sources. And something similar happens at Aldi: “80% of our products are of national origin, which also promotes greater acceptance by Spanish customers thanks to proximity and local products.”

The prospect of the war in Ukraine dragging on over time does not deter discounters, who boast of their ability to overcome difficult times. «Over the past two years, we have had to make great efforts in a complicated context in the new circumstances. The degree of adaptation of supermarkets to deal with the different cases that forces us to act quickly to continue to guarantee our service to our customers has become more apparent than ever,” they emphasize in Lidl. In Aldi, they acknowledge that the Ukrainian conflict “may cause changes in the usual activity of the distribution sector”, but they assure that they are “doing everything possible” to maintain their “growth prospects and contain prices, thus trying the affectation for the customer is the least possible.

Buying the Lidl food processor can be just as difficult as winning the lottery jackpot. Every time the company announces it will be releasing a few hundred of its ‘Monsieur Cuisine’, a fever runs high among shoppers, who will sweep the product off the shelves in hours, if not minutes. The war in court with the most famous brand of food processors, Thermomix, eventually won by Lidl, was the last push for this product range that the Spaniards had never seen in the ‘super’ until a few decades ago. “A ‘Lidl phenomenon’ has been created by iconic items such as our bread maker, our ‘Monsieur Cuisine’ food processor or slippers in Lidl’s corporate colors,” they say with satisfaction in the distribution company. German supermarkets have opened up a path in Spain that other companies have followed later, so that these branches are now a place “where you can do the complete weekly purchase,” confirms Aldi. In this firm they have their own crown jewel, the bazaar section. “We process specific offers in the range, from textiles to toys, through electrical appliances or household items.” “Our commitment is that customers can make a complete purchase at the lowest possible price, without sacrificing quality or responsibility, all coupled with a satisfying and simple shopping experience, facilitating consumer decision-making,” he said. .

Source: La Verdad


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