August 14, 2012

German grocer Aldi steps up presence in Florida

German food market Aldi is expanding its business in Florida, planning to hire 200 and open three more stores.

When it comes to German companies doing business in the United States, most Americans think of the big carmakers like Volkswagen or BMW.

Add a grocery store to the list: Aldi.

The discount-grocer, with headquarters in Essen and Muehlheim, Germany, has opened about 1,200 U.S. stores in 32 states. Now, Aldi plans to step up its presence in Florida.

The chain wants to bring at least 200 new jobs to the Sunshine State. In more than 35 hiring events across Florida through the end of September, the company is seeking to increase its workforce and is searching for cashiers, shift managers and manager trainees.

By the end of 2012, Aldi is gearing up to operate 56 stores across the state, including new ones in Kissimmee, Orlando and West Palm Beach. The Aldi empire includes gourmet grocer Trader Joe’s, which also has entered the Florida market.

“They are steadily growing all across the U.S.,” said David Livingston, a grocery analyst with DJL Research in Wisconsin. “Florida seems to be Aldi’s next step.”

Aldi already has made inroads in South Florida. In 2010, the chain opened a store in Deerfield Beach and soon added others in Lauderdale Lakes and Pembroke Pines. Aldi has several stores in Miami-Dade, including locations on Coral Way and in Cutler Bay.The investment comes at a time when other big grocers in the region like Publix, Walmart and Winn-Dixie are fighting for the customer’s money with expansions, new stores and renovations. Aldi’s market share in Florida can’t compete with that of its big rivals — but it is the business model that sets it apart from the competitors.

“Being different and significantly lower in price than the big chains is their formula for success,” Livingston said.

Aldi’s runs a spare operation. Food is displayed in open cartons. Choices are limited. Private labels get the exposure instead of big brand names. In most of the stores, customers are even encouraged to bring their own bags to pack their purchases.

“Aldi lives in its own little world,” Livingston said.

In Germany, Aldi has revolutionized the grocery market and fundamentally changed consumer behavior. Yet not much is known about the family that owns Aldi. The two leadings figures in the company’s history, brothers Karl and Theo Albrecht, made a fortune and were long regarded as the two richest men in Germany. But they tried to seal themselves off from society.

Theo died in 2010. In the archives, there is only one single quote that can be attributed to him. “Our advertising is our low costs,” he said. The sentence is from 1953.

Despite the shy leaders, the chain has reached mega status. Management has been criticized on employee relations including intimidation and labor conditions. In the United States, the company is promoting itself as a model of fairness.

Aldi, an official statement for the Florida job initiative says, offers employees “generous compensation that is well above the industry.” Even part-time employees would receive full health insurance, the company proudly announced.

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