Aldi Einkauf GmbH & Co oHG

2016-07-18

Aldi is a leading global discount supermarket chain with almost 10,000 stores in 18 countries, and an estimated turnover of more than €50bn.[1][4][5] Based in Germany, the chain was founded by brothers Karl and Theo Albrecht in 1946 when they took over their mother's store in Essen which had been in operation since 1913; it is one of the world's largest privately owned companies.[1]


The brothers built up a chain of stores until, by 1960, they owned 300 shops, and split the operation into two separate groups, that later became Aldi Nord, headquartered in Essen; and Aldi Süd, headquartered in Mülheim an der Ruhr.[6][7] The two operate independently, each within specific areas.


In 1962, they introduced the name Aldi (a syllabic abbreviation for Albrecht Diskont),[8] which is pronounced [ˈaldiː] ( listen). In Germany Aldi Nord and Aldi Süd have been financially and legally separate since 1966, although both divisions' names may appear (as if they were a single enterprise) with certain store brands or when negotiating with contractor companies. The formal business name is Aldi Einkauf GmbH & Compagnie, oHG.


The individual groups were originally owned and managed by the brothers. Karl Albrecht (d. 2014) retained ownership of Aldi Süd, and with a personal wealth of €17.2 billion, making him the richest man in Germany, while the co-owners of Aldi Nord, Berthold and Theo Albrecht Jr., close behind at €16 billion. Dieter Schwarz, owner of Lidl and Kaufland came in third, with a fortune of €11.5 billion.[9]


Aldi's German operations consist of Aldi Nord's 35 individual regional companies with about 2,500 stores in western, northern, and Eastern Germany, and Aldi Süd's 32 regional companies with 1,600 stores in western and southern Germany.[citation needed]


Internationally, Aldi Nord operates in Denmark, France, the Benelux countries, the Iberian Peninsula, and Poland, while Aldi Süd operates in Ireland, United Kingdom, Hungary, Switzerland, Australia, Austria and Slovenia (Aldi Süd operates as Hofer within the latter two countries mentioned). Both Aldi Nord and Aldi Süd also operate in the United States; Aldi Nord is owner of the Trader Joe's chain, while Aldi Süd operates as "Aldi".


In December 2002, a survey conducted by the German market research institute Forsa found 95% of blue-collar workers, 88% of white-collar workers, 84% of public servants, and 80% of self-employed Germans shop at Aldi.[10] One of Aldi's direct competitors internationally is Lidl.[citation needed]

Business organization

Germany

The Aldi Nord group currently consists of 35 independent regional branches with approximately 2,500 stores. Aldi Süd is made up of 31 companies with 1,600 stores. The border between their territories is commonly known as ″Aldi-Äquator″ (literally: Aldi equator)[14][15] and runs from the Rhine via Mülheim an der Ruhr, Wermelskirchen, Marburg, Siegen, and Gießen east to just north of Fulda.


The former East Germany is served by Aldi Nord, except for one Aldi Süd in Sonneberg, Thuringia, whose regional office is in Bavaria. The regional branches are organised as limited partnerships with a regional manager for each branch who reports directly to the head office in Essen (Aldi Nord) or Mülheim an der Ruhr (Aldi Süd).

Internationally

The Aldi group operates over 8,000 stores worldwide. A store opens roughly every week in Britain alone.

Aldi Nord is responsible for its stores in Belgium, the Netherlands, Luxembourg, France, Poland, Spain, Denmark, and Portugal, and also operates the Trader Joe's markets in the United States. Aldi Süd's responsibilities are in the United States (operating under the Aldi name), Austria and Slovenia (as Hofer), United Kingdom, Ireland, Australia, and Switzerland. Aldi Süd's first Switzerland store opened in 2005, while it has operated in Hungary since 2007. Aldi Süd had invested an estimated €800m ($1bn; £670m) in Greece from November 2008 until pulling out on 31 December 2010.[17]


While Aldi Nord has renamed its Dutch and Belgian subsidiaries Combi and Lansa to the Aldi Markt/Aldi Marché brand, Aldi Süd tries to maintain a regional appearance, branding its stores Aldi Süd in Germany, Aldi Suisse in Switzerland, and Hofer in Austria and Slovenia.[18]

In October 2013, Aldi opened the 300th store in the United Kingdom.[19] Since launching in the United Kingdom, in Stechford, Birmingham, on April 5, 1990, Aldi has grown consistently, and today has over 550 stores.


While it is still a small player in the United Kingdom, with a grocery share of less than 3.6%, its importance, along with that of continental no-frills competitor Lidl is growing, with half of shoppers in the United Kingdom visiting Lidl or Aldi over Christmas.[20] Aldi has opened stores in affluent locations, including Knutsford & Bury St Edmunds.[21]


In much of Australia, Aldi filled a void in the discount supermarket business that arose when the discount grocery chain Franklins went out of business. Aldi opened its first store in Sydney, 2001 and has grown exponentially since, maintaining a 12.6% market share as of early 2016.[22][23]


Aldi Süd expanded to the United States in 1976 under the Aldi banner, having expanded throughout the Eastern and Midwestern U.S., mostly through organic expansion, though it did buy Bottom Dollar Food in late 2014 from Delhaize Group.[24] Aldi Süd announced in early 2015 that it hoped to expand into the already highly competitive Southern California market where Aldi Nord's Trader Joe's is based.[25]

By mid 2016, Aldi had opened multiple locations across the greater Los Angeles area ranging from Vista, California to Bakersfield with several more locations slated to open by the end of the year.

Geographic distribution

Business practices

Some Aldi practices are common in German supermarkets but largely unique to Aldi in other countries.[citation needed] These include the system of metal gates and turnstiles forcing customers to exit through the checkout, and charging customers for shopping bags. Until 2004, Aldi stores accepted only cash (since then, German stores have accepted domestic Girocard debit cards). Debit cards also are accepted in the United States, the United Kingdom, Austria, Belgium, Denmark, France, Portugal, Spain, the Netherlands, Switzerland, Ireland, Australia, Slovenia, and Hungary. All 4 major credit cards are accepted in the United States as of March 1, 2016. Electronic Benefit Transfer cards are also accepted in the United States.[34]


Outside of the United States and France, Aldi generally does not accept credit cards, though Aldi Australia accepts MasterCard and Visa for a 0.5% surcharge and Aldi Ireland accepts Visa/MasterCard with no surcharge. In the United States, as of February, 2016, Aldi accepts all four major credit cards (MasterCard, Visa, American Express and Discover Card), and from the beginnings all credit cards "Carte Bleue" (Visa, American Express or MasterCard) in France due to the banking system in France where debit cards don't exist; prior to this, Aldi only accepted debit cards. Aldi has accepted Visa/MasterCard without surcharge throughout the United Kingdom from October 2014, which had previously been accepted only in Scotland,[35] and throughout Germany from September 2015.[36][37][38]


Aldi Suisse became one of the first companies to accept the Apple Pay contactless payment system in Switzerland on July 7, 2016.


Type

Private

Industry Retail

Founded June 23, 1913; 103 years ago

July 10, 1946 (split in two parts in 1960, renamed to Aldi Nord and Aldi Süd in 1962)[1]

Founders Karl Albrecht

Theo Albrecht

Headquarters Essen, Germany (Aldi Nord)

Mülheim an der Ruhr, Germany (Aldi Süd)

Number of locations

9,600

Area served

Europe

United States

Australia

Key people

Matthew Barnes (CEO, UK Operations)[2]

Products Food, beverage, toilet paper, sanitary articles

Revenue Increase €53 billion (2010)[3]

Website www.aldi.com

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