Lidl claims to be Europe's largest chain of discount superstores, now with around 9,875 outlets across 26 countries, under the banner "Quality For Less". Although it specializes in groceries, it also offers a select range of other goods including clothing and home electrical products, sometimes as limited period promotional specials. Most goods are private label, and Lidl stocks a wider range of products than traditional rival Aldi, while also offering a less stripped-down store environment. The main Lidl band is partnered by hypermarket brand Kaufland, now the market leader in Germany. With combined revenues from these two businesses growing steadily, parent Schwarz Gruppe overtook Metro, Carrefour and Tesco to become Europe's biggest retailer in 2015.
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Adbrands Weekly Update 18th May 2017: Discount retailer Lidl confirmed a date for the opening of its first US stores, on June 15th, mostly in Atlantic seaboard states such as North & South Carolina and Virginia. It plans to open 20 outlets this summer, and another 80 over the course of the next year. The long-anticipated arrival has sent shivers through the already over-stretched US grocery sector, stoking fears of a price war similar to that which has already transformed the UK and Australian supermarket environments. Several retailers have already lowered their prices in anticipation of the threat. Aldi is already active in the US, under its own name, and through group-owned Trader Joe's. Lidl will also launch with an aggressive product guarantee, "Lidl Love it", offering replacements and refunds for any items customers are not satisfied with. According to Lidl US CEO Brendan Procter, who arrives from Lidl Ireland, "The feedback we got from customers in the US was very clear. People feel they've been compromised. They feel you can get good quality, but it's extremely expensive, or you can get cheaper product, but the value reflects that... People want a good quality product, they want it at a good price and they don't want to spend all day in a store - they want to get back to living. That's what our model is about. That's our strength."
Adbrands Weekly Update 22nd Sep 2016: In a wholly unexpected development, Ronny Gottschlich, UK CEO of fast-growing supermarket retailer Lidl, has abruptly quit the company, apparently as a result of a personality clash with his newly appointed boss Daniel Marasch, who oversees Northern Europe. Gottschlich has overseen a dramatic growth in Lidl's UK sales - up over 40% in the past two years to £4.7bn - but his investments in marketing and staff benefits are said to have been out-of-keeping with the wider group's more conservative policies. Christian Haertnagel, former head of Lidl Austria, is to replace Gottschlich in the UK.
Adbrands Weekly Update 19th Nov 2015: Latest figures from Kantar Worldpanel for the UK grocery market, for 12 weeks to 8th Nov, show Tesco at its lowest market share for more than a decade, while Aldi and Lidl topped 10% combined for the first time. Tesco's share slipped to 27.9%, falling below 28% for the first time since the current pricing battle began three years ago. Sainsbury's charged into second place at 16.6%, overtaking Asda at 16.4%. It has overtaken Asda once or twice before, but never by as much as 0.2%. Of the two German discounters, Aldi was unchanged at 5.6%; this time it is Lidl that has been in the ascendant, hitting 4.4% for the first time, up from 3.7% this time last year.
Adbrands Weekly Update 16th Jul 2015: German discount supermarket Lidl revealed that its UK sales jumped by more than 20% in the year to Feb 2015, topping £4bn for the first time. The increase was prompted not only by increased local store traffic but also exports of British produce such as cheese and Scotch whisky to other Lidl territories. The retailer aims to double its UK estate from 620 stores currently to as many as 1,200 over the next few years.
Adbrands Weekly Update 20th Nov 2014: The UK's grocery sector reported a 0.2% decline in the latest sales figures from Kantar Worldpanel, the first fall since Kantar's records began two decades ago. The cause is the brutal ongoing price war, in which the Big Four multiples are wrestling with one another to match discount prices offered by challengers Aldi and Lidl. Tesco was the biggest victim, with a 3.7% decline in actual sales in the 12 weeks to 9th Nov, compared to a 3.3% fall for Morrisons and 2.5% for Sainsbury's. Asda matched the overall market with a decline of just 0.2%. At the other end of the scale, Aldi's sales jumped by 25.5%, Lidl grew by 16.8%, while upmarket grocer Waitrose - which has largely avoided any involvement in the war - put on 5.6%. A new report from Goldman Sachs published this week suggested that the current crisis is largely the major chains' own fault because overconfidence in the structure of the market at the end of the 2000s encouraged them to overspend on store expansion. "Basically, too much supermarket floor space was added, prices were increased and services cut to support profit margins". Goldman warns that the price war is unsustainable. It is now impossible for the big chains to match the profit returns of the no frills discounters because of their bloated cost base. Their only option, says the report, is to start shutting stores, possibly as many as one in five of their existing estates. "Capacity exit is the only viable solution for a return to profitable growth."
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