Also in Great Britain Aldi engages in a price war with domestic supermarket chains

"Aldi Price Match" - the British supermarkets are trying to stop the triumphant advance of the German discounters with price campaigns. But are they also helping the competition?

DPA

11.09.2024, 05:13

11.09.2024, 05:22

dpa

The German discounter Aldi continues to engage in a fierce price war with the established chains in the UK. According to Aldi UK, the German discount grocer achieved record sales of the equivalent of around 19.8 billion francs last year - an increase of 16 percent compared to 2022. Profits before tax even rose from the equivalent of 169 million to 595 million francs.

However, Aldi's triumphant advance slowed somewhat in the current year. Its market share even fell slightly at times. According to experts, this is also due to the fact that long-established British supermarket chains such as Tesco, Sainsbury's, Asda and Morrisons have introduced so-called "Aldi Price Match" offers. Products are advertised as being available at the same price as at Aldi.

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Aldi's Managing Director for the UK and Ireland, Giles Hurley, announced that, in addition to investments, he intends to reduce prices further. He is "pretty optimistic" that there will be further price cuts before Christmas, he told the British news agency PA.

Retail expert Stephan Rüschen does not think it is clever for the British supermarket chains to attach signs with the words "Aldi Price Match" to the relevant shelves. "This gives Aldi a particularly prominent position. Aldi does indeed have this as price leader, but you don't have to support this in terms of communication."

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The UK is the world's third most important market

Such signs are not to be found in Germany, said the Professor of Food Retailing at the Baden-Württemberg Cooperative State University in Heilbronn. De facto, however, there is also a price focus on Aldi. All retailers align their entry-level items with Aldi and adjust the price to the Aldi price on a weekly basis. This is even the case with branded products such as Nutella.

German retailers prefer to refer to the large number of discount items in their communication with customers. "This is supposed to promise: You can save yourself a trip to the discount store," says the expert.

According to the EHI Retail Institute, the UK is the third most important market for Aldi worldwide after Germany and the USA. The discounter now has a market share of ten percent, making it the third-largest supermarket on the island. Its competitor Lidl is hot on its heels with a good eight percent.