Aldi Quietly Enters New York City
While Wal-Mart and Target boast of plans to open smaller stores
to squeeze their way into U.S. cities, one of their likely competitors is already
An article in The New York Times fairly marveled at how
Aldi has in recent years sneakily established a foothold in many cities —
including a location that opened in February in Queens, NY with a second one
in the city planned for the Bronx later this year. The entry comes despite
being non-union, one of the largest retailers worldwide, and foreign to boot.
But much of the
article largely served as an introduction to the German-based limited-assortment
grocer, which now counts more than 1,000 stores across the country. After opening
its first store in 1976, its growth has accelerated in recent years to between
80 to 100 stores annually.
The stores — ranging from 10,000 to 17,000
square feet — carry about 1,500 of the most popular grocery items. About 95
percent of the mix is private label. It also has many quirks largely to keep
prices low, including charging a quarter to get a shopping cart with a refund
upon cart return. It also has no butcher or bakery, sells fruit by the
bag to speed checkout, and it doesn’t advertise.
The low-prices are expected to make
Aldi most appealing to city dwellers. The company claims its discounts are
up to 45 percent off competitors, although analysts told the Times the
discounts are probably closer to 20 percent on average.
The Times article still
wondered whether the limited assortments and dearth of national brands would
work in cities.
A query on consumerist.com exploring the Aldi concept
received more positive than negative comments.
Said one, “I’ve gotten
better food at Aldi’s than I have at the grocery store my husband works at,
and that’s saying a lot. I’ve had some of the best apples, bananas, oranges
from there. Granted they don’t get fancy, but I don’t need an organically grown
piece of fruit to get what I need in my diet.”
Another wrote, “We
buy lots of fresh produce, a small amount of meat, some fresh and high quality
dairy items, etc… Aldi just doesn’t have the kind of products we buy, and
the ones they have that we do use aren’t that great. I think if you buy lots
of canned and prepackaged stuff, it’s a good place to go to save some cash.”
- Where Wal-Mart Failed, Aldi Succeeds – The New York Times
- Is Aldi Just Trader Joe’s Without The Marketing Budget? – consumerist.com
- NYC unfairly biased against Wal-Mart? – New York Metro
- Retail Forecast: Walmart Versus Aldi or Battle of the Grocery Titans – Gerson
- Aldi expansion will reach into N.Y.C. – The Packer
- Aldi to open Medford store this summer – Boston Business Journal
Discussion Questions: What do you think of Aldi’s growth potential in cities? How do you expect Aldi to fare against smaller concepts being developed by Wal-Mart and others?