Lidl: Big competitor enters U.S. food retail

In one week, the German discount food chain Lidl will start opening their first 20 sites in the United States, located in North Carolina, South Carolina and Virginia. They plan on scaling their store network up to 100 by the end of the year, requiring an estimated 4,000 new employees. In Europe, the retailer is the biggest rival of Aldi, which has already gained some popularity among American customers for offering low priced groceries at smaller selection and reduced customer service.

The Infographic shows that Aldi and Lidl (which is the driving force of the Schwarz Group’s turnover) are the leading food discount store companies. Being a great success in Europe for quite some time, the concept is just slowly picking up pace in the United States. Whereas having a minor influence on the U.S. market, the German companies are ranked among the six most successful food retailers in the world, according to a recent study from Deloitte. Deep discount stores appear to still be a niche sector in the U.S. compared to the global trend. While spreading all over Britain, Aldi and Lidl decimated the market share of the UK domestic food chains and reduced their margins. The extra competition lowered the prices for consumers though.

Although Lidl is only known for its discount grocery stores, they are planning to alter their U.S. stores a little bit from the European version. According to Business Insider, Lidl Stores will more likely be hybrids of discount stores and conventional supermarkets. Key features will be bigger stores than Aldi, more customer service, a wider variety of products and prizes below conventional supermarkets. Lidl and Aldi are both expected to be fierce competitors in the future, both planning to reach 2,000 U.S. stores by 2020. (Source: Statista)