Germany's Aldi Plans Big US Push

Sets expansion to 2,500 stores by 2022

June 12, 2017

Low-price German grocery chain Aldi set plans to aggressively ramp up its growth in the US, saying it would remodel 1,300 stores by 2020 and expand to 2,500 stores nationwide by the end of 2022.

Aldi currently operates more than 1,600 U.S. stores in 35 states. With the exception of 38 stores in Southern California, it has no footprint in the western US.

A value-oriented chain that emphasizes house-brands, low cost and limited inventory, the chain bears some resemblance to Trader Joe's. In fact, the companies are related: Trader Joe's is owned by the family of one of Aldi's founders.

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The focus on price, and the de-emphasis on brands, appears to put Aldi in the sweet spot for millennial shoppers, who over-index for use of discount grocery retailers such as Food4Less and 99 Cents Only stores, and who tend to be less brand-loyal than older shoppers. 

Aldi said that, at 2,500 stores, it would be the third-largest grocery retailer in the US. Not counting the discount giants like Walmart and Target, Kroger has the largest number of grocery stores in the US, with 2,796 supermarkets under two dozen banners including Kroger, City Market, Dillons, Jay C, Food 4 Less, Fred Meyer, Fry’s, Harris Teeter, King Soopers, QFC, Ralphs and Smith’s.

The US expansion by Aldi comes as its German discount rival, Lidl, is embarking on its own expansion into the US. Lidl expects to open 20 stores this summer and 100 stores by early 2018.