NO FEARS FOR ALDI AS KAU­FLAND MOVES IN

The Gold Coast Bulletin - - BUSINESS - ED­WARD BOYD

ALDI Aus­tralia chief ex­ec­u­tive Tom Daunt is not in­tim­i­dated by the loom­ing ar­rival of Ger­man re­tailer Kau­fland, say­ing tra­di­tional Aus­tralian su­per­mar­kets like Coles and Wool­worths will be more ex­posed.

Mr Daunt wel­comes Kau­fland’s en­try into the Aus­tralian market and be­lieves it will boost com­pe­ti­tion in the $90 bil­lion sec­tor, which in turn will be a win for cus­tomers hunt­ing for cheaper prices.

Gi­ant gro­cery chain Kau­fland has $88.4 mil­lion in cap­i­tal ded­i­cated to es­tab­lish­ing its pres­ence in Aus­tralia and re­cently forked out $25 mil­lion to buy a 36,000sq m ware­house site on the out­skirts of Ade­laide.

Mr Daunt said Kau­fland, which is part of the Sch­warz Group – the fourth largest re­tailer in the world which also owns dis­count su­per­mar­ket chain Lidl – was not a big threat to Aldi due to the dif­fer­ences in prod­uct range and floor size.

“They have a very large for­mat so our busi­ness models are ac­tu­ally quite dif­fer­ent. I would call them sim­i­lar to a cross be­tween a tra­di­tional Aus­tralian su­per­mar­ket and Costco,” he said.

Kau­fland stores tend to stock up to 60,000 items and are spread out over 20,000sq m.

In con­trast Aldi stores have about 1,500 items and are spread over about 1000sq m.

“They are a large for­mat and they do have a large prod­uct range so I think more tra­di­tional su­per­mar­kets could be more ex­posed,” Mr Daunt said.

“I have read re­ports that they have pur­chased their first site in Ade­laide, I think it will take quite a while for them to get up and run­ning.”

Kau­fland is re­port­edly scop­ing sites in Syd­ney and Mel­bourne and is in the process of com­pil­ing its Aus­tralian man­age­ment ranks.

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