Fresh veggies

German discounter Aldi takes on Italy

Aldi Italy
Aldi is expanding to the sunny south. Source: Aldi Italia

It would be hard to find two countries that are more different when it comes to food than Germany, land of the Currywurst and beer, and Italy, home of fresh pasta and wine. But after a two-year study of Italian tastes, German discount chain Aldi has decided to take the plunge south of the Alps by opening 45 stores in Italy.

Aldi, which also has 1,750 stores in the US and is owned by Germany’s richest man, Karl Albrecht Jr., opened the first Italian market in Castellanza near the Swiss border and has plans to hire 1,500 people this year.

“Our biggest challenge is to meet the demands of Italian customers every day, so we look at the origin, freshness and quality of our products,” said Country Managing Director Michael Veiser. As a result, Aldi will source 75 percent of its products from Italian suppliers, he said, with a focus on fresh vegetables and fruit.

“We manage to get food off the field in less than a day.”

Michael Veiser, Aldi managing director for Italy

“That is our strength,” Mr. Veiser said, “because we manage to get the food off the field in less than a day.”

Each store will have a “gourmet” section like small Italian shops in every city, and fresh bread and bakery products. There will also be a coffee bar, where they will serve cappuccinos and sell Italian coffee beans.

Aldi faces tough competition in Italy from German rival Lidl, which has 600 stores in the country, as well as Italian food chains such as Eurospin. According to the Italian business daily Il Sole 24 Ore, Eurospin had sales of €4.7 billion and 5.3 percent of the Italian retail market, while Lidl had Italian sales of €3.7 billion and 3.1 percent of the market.

“We know we are in a very difficult market with many solid competitors,” Mr. Veiser said. “But we want to differentiate ourselves with a quality offering without focusing exclusively on prices, because that’s not enough for Italian shoppers.”

Aldi Italy
Fresh foods at "rock bottom prices" in Aldi Italy. Source: Aldi Italia

Mr. Veiser said that Italians tend to linger in stores, discussing products rather than quickly doing the shopping, as most German customers do.

The Aldi supermarket chain is actually two companies owned by the children of the original firm’s founder. Aldi Nord, owned by Theo Albrecht, owns Trader Joe’s in the US, while Aldi Süd has stores in the UK, Hungary, Ireland, Switzerland and Austria.

Its formula is to concentrate on about 1,100 house-branded products that it makes at contract factories and sells way below market price for similar branded goods.

Aldi Süd is building a headquarters and logistics center in Verona, which will employ more than 800 employees. It is hoping to add another 1,500 jobs in the stores.

Aldi is not the only German company jumping into Italy at a time when the economy is finally turning around after nearly a decade of low growth. Perfumery Douglas last year purchased Italian beauty retailers Limoni and la Gardenia Beauty and optician Fielmann has opened 10 shops in northern Italy, where most of the world’s eyeglass frames are made.

Regina Krieger is Handelsblatt’s correspondent in Italy and Charles Wallace is an editor for Handelsblatt Global in New York. To contact the authors: krieger@handelsblatt.com and C.Wallace@extern.handelsblatt.com.

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