Aldi Case Study

Topics: Training, Vocational education, Apprenticeship Pages: 9 (2738 words) Published: June 11, 2014
Business expansion through training and development

Aldi (short for Albrecht Discounts) is a globally operating and expanding discount retailer with over 8,000 stores all over the world. The company was founded in 1913 in Germany by two brothers. In 1960 the former Albrecht KG was separated in Aldi Sued and Aldi Nord. The headquarters are located in Essen (Aldi Nord) and Mülheim an der Ruhr (Aldi Sued). Both companies still have a friendly relation and use the same brands occasionally but operate independently. Aldi Nord operates in Denmark, the Benelux countries, France, the Iberian Peninsula and Poland. Aldi Sued makes its business transactions in countries including Ireland, the United Kingdom, Greece, Switzerland, Hungary, Austria, Slovenia, USA and Australia. In Austria and Slovenia Aldi is represented by Hofer KG. Overall Aldi is one of the world’s biggest grocery chains. The sales strategy is well known as they offer the opportunity to buy cheap and good/fresh food. The main focus is on key markets in Europe, North America and Australia. Store layouts are simple and opening hours focus especially on the busiest times of the day. The retailer is a specialist in food, beverage and household items but within the years the portfolio was extended. The company acts now among other things for example, as travel agency. Many of the offered products are own brands. The number of other brands is limited to a maximum of two for an item. Therefore it is possible to keep the shops smaller and to sell a larger quantity of a specific brand. The slogan “Spend a little, live a lot” reflects the strategy of Aldi. In a nutshell to keep prices low they are not taking effort on presenting their variety of goods. Worldwide main competitors of Aldi are Wal-Mart Stores, Inc., METRO AG and Lidl Dienstleistung GmbH & Co. KG. Particular Austrian competitors are Zielpunkt, Norma and Penny. The strategy of the mentioned chains is similar. They are all driving their main business in the food industry as they are primarily competing on price in order to increase their market share. Main customers are bigger families, housewifely people and people with less income. The marketing mix of every business is different. Aldi focusses on providing high quality products that are cheaper alternatives to famous brands. Moreover, the advertising strategy is very simple and cost saving. Apart from a weekly newsletter of special offers Aldi is not advertising at all. Primarily this low price grocery chains arose due to the increasing population and economic challenges. Therefore it was necessary to construct bigger plants which resulted in fewer and larger firms. This had a negative effect on farmer’s return and all of a sudden people started to concern about the products they were consuming. Aldi was very hard affected by these changes and implemented sustainable products. Now they offer especially in the diary product sector regional goods. Certainly important to mention is the simple organization structure of Aldi. The very flat management hierarchy allows leaders to get their people known. At Aldi managers should be open for new ideas, improvements and it is common to involve all employees in decision making. They represent a philosophy of promoting and supporting talents within the organization. Consequently the performance of each employee is recognized easier. As the responsibility is increasing within promotions it is essential to support a transparent and effective decision making system. Subsequent the discretion of the Aldi organizational chart. On the very top of the management is the Vice President followed by several Directors like Director of Warehousing & Transportation and Director of Administration. The District Managers are directly reporting to the Director of Operations and are leading the individual Store Management Teams. The number of Store Employees is based on the frequency of customer visits.

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