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UK supermarkets struggle to compete as Aldi and Lidl’s discount model thrives.

todayFebruary 22, 2023

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Despite claims of increasing competitiveness on price, major UK supermarkets such as Tesco, Sainsbury’s, Asda, and Morrisons are facing tough competition from German-owned discount stores Aldi and Lidl. Aldi UK CEO Giles Hurley has pledged to offer the country’s lowest prices, regardless of the competition. This has put pressure on the major players to cut costs and retain customers amidst a cost of living crisis.

Over the Christmas period, customers switched £58 million of purchases to Lidl from Tesco and Sainsbury’s. The discounters have already captured over 16% of the British market between them, and industry experts predict this could double within a decade as they continue to expand.

Aldi and Lidl’s size guarantees better supplier deals, while their private ownership allows them to take a longer-term view on profit. Discounters hold over a third of the supermarket sector in countries such as Germany, Poland, Denmark, and Norway, and the UK shopping landscape is expected to follow suit.

As of now, Aldi UK is the fourth-largest grocer in the UK with a market share of 9.2%, while Lidl is the sixth-largest with 7.1%, according to researcher Kantar.

Written by: Relaks Radio

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