Aldi credits supermarket price wars as growth driver
Budget supermarket Aldi has claimed that the ongoing price wars between Tesco, Asda, Morrisons and Sainsbury’s has helped it achieve stronger growth in the first half of 2014 than in the first six months of last year.
Sales increased 36 per cent to £5.3bn in the year to December 2013 while pre-tax profit increased 65 per cent to £261m.
Aldi’s basket size has also continued to grow; according to Neilsen data it is now the second largest in the UK, behind Asda, with on average 17 items.
Matthew Barnes, group managing director of Aldi, said the aggressive price cuts at the big four have encouraged consumers to “think more” about what supermarkets charge.
“Data shows that, while our average basket size is only one or two items smaller than Asda and similar to that of Tesco’s, our average basket is about £6 to £7 cheaper. We are confident that our prices are 30 per cent to 50 per cent lower than at the supermarkets, and this adds up to big savings for our customers on their weekly shop.”
Aldi also hailed its customer service as a factor in the growth trend and pointed to a Which? customer satisfaction survey that placed the retailer in first place. It was the only supermarket to score five out of five stars for pricing in the survey and also scored positively for fresh produce quality, customer service and store environment.
Roman Heini group managing director of Aldi UK added: “Aldi is not no-frills shopping. No-frills suggests that shoppers have to make a compromise and that they are less satisfied with their shopping. As the Which? survey shows, this is not the case at Aldi. People can get what they want and need in our stores, and they are delighted by our overall offer.
“It is this level of satisfaction that is both changing how people are grocery shopping in the UK and propelling our growth. We’ve achieved this by thinking, acting and shopping like our customers. They are at the heart of everything we do.”
Aldi, which attracted one million more shoppers in August this year compared to the same period in 2013, is planning a nationwide expansion programme to support its growth and will open 54 new stores this year and a further 60 next year, taking its total number to more than 600.
Last week Sainsbury’s launched a new ad campaign focussed on its rival Asda as part of an 18 month commitment by the business to lower the regular prices of products across the grocery business.