1. Food Discounters
Georgina Cameron, Michelle Garcia, Vicki Pereira, Jane McKenna and Madeleine Frid

2. What are Food Discounters?
Stores which sell foods at reduced prices. They cut costs by having small numbers of staff, minimal technology and few named brand goods.

3. Major Stakeholders
4 Main stakeholders:
Aldi
Netto
Lidl
Kwik Save

4. Historical developments
Originated in europe
Aldi was the first - opened in Germany in 1948
Introduced into Britain in the 1990s
Tesco and Sainsburys introduced their budget ranges
“the multiples have cut off the discounters life blood”

5. Economic Status
Growth in food discounters is higher than that for the UK retail industry as a whole
Less than 1% of total retail industry
Represents 10% of grocery market
Estimated £1.49bn in 2000
Supermarketing, April

6. Economic Status How do discounters make their money?
Concentrating on own label products
Buy stock at lowest possible prices - sold at low prices
Few staff - low wage costs
Smaller stores
Little advertising - In 2001 Aldi spent just £3.2 million on advertising. Tesco spent £1.1 million on Value range alone

7. SWOT analysis
* Aldi only
IGD research

8. Current Trends Aldi dominates German discounters
Aldi now have 250 UK stores
In February 2001 Aldi opened their first store in Australia
Aldi had invested $A million in Australia by the end of 2001
Early in 2001 Aldi and Lidl bid for Iceland
Infotrak

9. Innovation
Innovation: “An idea, service, product or piece of technology that has been developed and marketed to customers who perceive it as something novel and new”
Kotler and Armstrong, Marketing in Practice

10. Innovation Back to basics Store layout Low price strategies
Just in Time stock control

11. Growth Potential Aldi and Lidl’s Current business strategy:
IGD research

12. Growth Potential Aldi Stores in the UK Lidl stores in the UK
* Estimate
Lidl stores in the UK
A.C Nielson/IGD research

13. Future Prospects Expanding into more countries
Supermarkets are responding by lowering prices
“the biggest threats to discounters are each other…. It is predicted that only Kwik Save and Aldi will be the primary survivors”
Reed Elsevier Business Publishing Ltd 1995

14. Are customers more interested
Future Prospects
Are customers more interested
in price or quality??