Lidl launches £500m assault on its rivals
BUDGET grocer Lidl is plotting a £500m expansion in the UK as it ramps up its battle with Britain’s big four supermarkets.
Lidl said it will create 1,500 jobs over the next five years in 40 new stores, including opening its first major outlet in central London.
All of the new shops will be built within the M25, where the Germanowned firm has traditionally had a smaller presence. Locations include Alperton, East Acton, Hackbridge and Watford.
Lidl was founded in Germany in 1930 as a fruit wholesaler and has grown to have more than 10,000 stores across countries including the US, Singapore, Hong Kong, Portugal and Spain.
It opened its first UK store in 1994 and now employs more than 22,500 staff nationwide in 760 outlets and 13 warehouses.
Britain’s four largest supermarkets – Tesco, Sainsbury’s, Asda and Morrisons – are battling to keep hold of customers and prevent them being lured away by lower prices on offer at Lidl and its German rival Aldi.
Sainsbury’s and Asda suffered a major defeat in April when their planned merger was blocked by competition authorities. The pair cited the growing threat of Lidl and Aldi as one of the main reasons for pursuing the tie-up.
Lidl’s new central London store on Tottenham Court Road will rival Tesco and Sainsbury’s, which both have convenience shops on the same road.
But in contrast to these competitors – whose smaller central London sites stock a limited selection of products – Lidl will offer its full range and also have a freshly baked goods section.
The 1,300 square-metre store will also retain Lidl’s hugely popular middle aisle, which stocks limited clothing and home products. Recent offers have included a £100 outdoor pizza oven and a £50 metal detector.
As part of its investment in the capital, Lidl is also building a new UK headquarters in Tolworth. The 800 head office employees will be moved from their current location in Wimbledon.
And it is expanding its warehouse in Belvedere, south- east London, and building a new distribution centre near Luton that will serve stores and customers across Greater London.
Rajesh Agrawal, London’s deputy mayor for business, said: ‘Lidl’s commitment to the capital is great news for London shoppers, a big boost for the jobs market and a further show of confidence in the London economy.’
Christian Hartnagel, chief executive of Lidl in the UK, said: ‘London is at the heart of our growth plans across Great Britain, and we are proud to be in a position where we’re continuing to create new jobs.
‘Our £500m investment reflects the scale of opportunity we have to bring our quality produce to even more of the capital’s communities, at prices that make it affordable to everyone.’
Earlier this year, Lidl pushed down its minimum size for new London stores, creating the potential for the chain to open more inner-city outlets.
The move came as Aldi – Lidl’s biggest rival – launched new local stores which operate from smaller sites in London. The first opened in Balham in March.
According to figures from Kantar, Lidl currently holds a 5.8pc share of the UK grocery market – behind Aldi, which has 8pc, but ahead of Waitrose’s 5.1pc. Tesco is the largest supermarket chain, dominating 27.3pc of the market.