The supermarket chains Aldi and Lidl dominate the German discounter market. Will another company be dangerous now?
Munich – The discount store business in Germany is booming. Businesses such as Aldi, Lidl, Penny and Netto account for around 43 percent of sales in the German food retail sector. The branches of Lidl and Aldi are particularly successful here: around 80 percent of consumers shop at one of the two supermarkets.
The corporations are now even so good that both start various major projects: The Schwarz Group, the parent company Lidl, now actively involved in the German waste management and Aldi offers its customers even directly at the parking lot a gas station. Not even recurring recalls of supermarkets can shake this supremacy.
But now seems a new competitor to stir up the German cheap market: The Russian discount chain Torgservis. Her daughter TS Markt GmbH is now looking for new locations in Germany.
Possible Aldi / Lidl competitor is looking for locations in East Germany
The Russian supermarket is currently looking for more than 100 locations in Germany, according to the "Lebensmittelzeitung". Particularly interesting are new branches in East Germany, currently looking for TS Markt GmbH in Mecklenburg-Western Pomerania, Saxony, Saxony-Anhalt, Thuringia and Brandenburg by operating areas. The reason for the focus on East German territories is the target group: immigrants and Eastern European citizens in particular should be convinced of the range of products, it is said.
Where does the money for such an expansion come from? The discounter Torgservis is incredibly successful, according to epochtimes.de in Russia. The company, which was founded in 2009, has been able to quintuple the number of branches in the last four years, with external sales tripling to 1.3 billion euros over the same period. "In addition, the chain pursues a franchise model, which each branch is a separate legal entity," the newspaper continues. In 2017 it would have been possible for the discounter to expand from the rural Russian regions. First to Moscow, then to Kazakhstan, now to China and Belarus. And now just the German market is to follow.
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Possible Aldi / Lidl competitor Torgservis wants to score in Germany with a simple offer
The Russian company is looking for the Lebensmittelzeitung In Germany plant areas ranging in size from 800 to 1200 square meters, parking should be available for 30 to 40 cars. For comparison: The two German discounter heavyweights Aldi and Lidl have now expanded their stores to an area of about 1500 square meters, as the Epoch Times writes.
Next set the Russian discounter on strategies that recall the beginnings of Lidl and Aldi. For while the German discounters would now pay more attention to a larger assortment, Torgservis remain simple. Only 1500 to a maximum of 2000 own brands should be offered on wooden pallets in the supermarket.
Video shows food chain in Russia
Whether the Russian discount chain will succeed with its expansion in Germany is still uncertain. Experts prophesy but a difficult start: The supermarket must comply with high standards in German food law and quality requirements of customers compared to Russia, but can still offer the cheap prices. Until the company has adapted to these conditions, Lidl and Aldi remain for the time being pioneers in the German cheap market.
By the way: Aldi threatens a dispute over a popular product. The discounter wants to lower prices, but gets headwind.
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