Question

How has Aldi's innovations affected wholesalers and other suppliers?

Answer 1

Aldi is a common brand of German family-owned discount supermarket chains. It has over 10,000 stores in 20 countries and a turnover of more than €50 billion. The following are the major factors that keeps Aldi different and more attractive among various other supply market stores in the world

· They are the best examples of no-frill stores which often displays a variety of items at discount costs.

· Most of its products are its own brands as it represents a family owned store.

· The number of brands per each commodity has been restricted to two

· They offer weekly special prices for costlier and luxury commodities.

· It does not follow any advertising practice in Germany and the only advertisement provided is the distribution of its special prices in the name ‘Aldi informs’ weekly

· They have innovative packaging options which have helped them to deal with customers much better than many other firms

Effect of Aldi among in wholesale market and among other suppliers

· Aldi has made huge intrudes in to many markets, but the major impact is visible in the market of UK where it has been awarded the best supermarket for many times.

· Since they rely on the strategy of limited products and maximum profits, it has brought a change in the behavior of wholesale market and has forced the other suppliers to follow the trend.

· With changing product mix and low space store concept, it has made innovations in the look and supply models of wholesale and supermarket structures which has had huge impact on other suppliers.

· It has the policy of spending low n advertising and the cost saved by this is provided as discount to the customers. This is a different approach which have influenced many retailers

· It has been instrumental in bringing ‘price pressure’ to all its competitors.

                                                   The supermarkets and wholesale markets have been following a general trend across the globe. With the introduction of Aldi’s business strategy, it is now forcing the global competitors to change the way they think and bring much more innovations so as to stay active in the supply market.