The Wall Street Journal reports that discount retailer Aldi has "detailed plans to grow in the U.S., saying it would invest billions of dollars and create thousands of jobs."
Included in its growth scenario is a plan to open its first Southern California store in March 2016 and have 25 there by mid-year.
According to the story, "The retailer, which described its U.S. expansion plans as 'aggressive,' said it would put more than $3 billion behind a previously announced five-year plan to open 650 new stores across the U.S. By the end of 2018, Aldi expects to operate nearly 2,000 stores, or about 44% of rival Wal-Mart Stores Inc. ’s current U.S. store count. The German company already operates nearly 1,400 stores across 32 states."
The story goes on to say that "Aldi said it would pay starting wages of $13 an hour for store associates, with an opportunity to earn up to $21 an hour. Attention to minimum wages has ramped up in the U.S., with new initiatives in Seattle and Los Angeles, at Wal-Mart and other companies, and some congressional moves on the federal minimum. California’s hourly minimum wage is currently $9, rising to $10 next year."
Included in its growth scenario is a plan to open its first Southern California store in March 2016 and have 25 there by mid-year.
According to the story, "The retailer, which described its U.S. expansion plans as 'aggressive,' said it would put more than $3 billion behind a previously announced five-year plan to open 650 new stores across the U.S. By the end of 2018, Aldi expects to operate nearly 2,000 stores, or about 44% of rival Wal-Mart Stores Inc. ’s current U.S. store count. The German company already operates nearly 1,400 stores across 32 states."
The story goes on to say that "Aldi said it would pay starting wages of $13 an hour for store associates, with an opportunity to earn up to $21 an hour. Attention to minimum wages has ramped up in the U.S., with new initiatives in Seattle and Los Angeles, at Wal-Mart and other companies, and some congressional moves on the federal minimum. California’s hourly minimum wage is currently $9, rising to $10 next year."
- KC's View:
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I have to be blunt. This should scare the crap out of some people.
Think just for a minute about the havoc that Aldi and its fellow discounter Lidl have created in the UK, where the two of them have in fairly short order gone from a 6.3 percent market share in 2013 to a 9.3 percent market share today, with some educated estimates suggesting that they could together have as much as a 15 percent market share by 2020. (I actually think they'll do better than that. Call it an uneducated guess.)
And think for another minute about how together, Aldi and Lidl have helped turn Tesco from the dominant retailer in the UK that seemed to do no wrong, into one that seems mistake-plagued and unable to capture its past magic. (To be fair, they had help - Sir Terry Leahy's arrogance, and a Tesco culture that grew toxic.)
And finally, remember one more thing - that Lidl is coming to the US in 2018.
Forget basketball coaches. FMI should've had a session this week in which they taught retailers how to play defense and offense against Aldi and Lidl.
