Aldi, the UK’s lowest-priced supermarket, has announced record results for its last financial year, with sales continuing to increase in 2018 as growing numbers of British shoppers switch from the Big Four.
Sales in the UK and Ireland rose 16.4% to £10.2bn in the year to 31 December 2017 (2016: £8.8bn) – a higher growth rate than the previous year (13.5%) and over five times faster than the overall grocery market (3%).
The supermarket – now Britain’s 5th biggest with over 775 stores – gained more market share than any other last year, attracting a further 1.1m shoppers through its doors with its unique combination of lowest prices and award-winning quality, according to Kantar Worldpanel data. It now commands 7.6% of all UK grocery spend.
The same data also showed more customers shopped more of Aldi’s range, with the average number of items bought per trip rising to over 19 – the highest in the sector**. Some of its best-performing products were its Specially Selected premium range – which now generates sales of over £1bn annually – alongside fruit and veg, fresh meat and fish, its award-winning mother and baby range and beers, wines and spirits.
Aldi, which was recently named supermarket of the year in The Grocer Gold Awards, said over 200 new products have been introduced this year, including its Specially Selected Aberdeen Angus Beef and Mushroom Ravioli, Oliver Cromwell Pink Gin and Moser Roth Flaked Truffles.
Over 30% of its range has also been reformulated to further improve product quality, including its steak and claret pie, hazelnut chocolate spread, Mediterranean falafel, Chilean merlot and premium pork sausages.
Recent data from trade magazine The Grocer meanwhile confirmed Aldi as Britain’s lowest priced supermarket once again, with a basket of everyday items being on average 22% cheaper than the Big Four.
Giles Hurley, CEO - Aldi UK and Ireland, (pictured) said, “The revolution in British grocery shows no sign of slowing. Savvy customers know they can swap and save with Aldi, thanks to great quality products at lower prices. This is happening on a massive scale, with more than 1.1m new customers shopping with us throughout 2017.
“While other grocers introduced more complexity into their businesses in their struggle to win back customers, we stuck to our guns and focused on doing what Aldi does best – buying smart, staying lean, improving quality and keeping prices low. Our biggest strength is our simplicity – a carefully selected range of exclusive own-label brands and award-winning products at the lowest prices. Millions of Britons can put fantastic-tasting food on their table every day of the week, at prices they can afford.”
Last year Aldi announced a £1bn capex investment during 2017 and 2018 to open new stores in every part of the UK, hundreds of store upgrades and extended distribution centres. It remains firmly on course to hit this target.
Looking further ahead, Aldi said it would open a further 130 new stores between 2019 and 2020, while continuing to invest in its Project Fresh initiative – a £300m investment to create more in store space for fresh, chilled and food-to-go ranges as well as simpler layouts, improved fixtures and brighter, wider aisles. Over 200 existing stores will have been converted to the new format by the end of this year and a further 380 stores by the end of 2021.
To fuel its expanded store network, three new Regional Distribution Centres (RDCs) are already planned for Sheppey, Sawley and Bedford in the coming years, as well as extensions to existing centres in Darlington and Bathgate.
The company, which offers market-leading pay and benefits for store employees, said its planned expansion would create 5,000 new jobs over the next two years.
Aldi, which already sources its entire core range of fresh meat, eggs, milk, butter and cream from British suppliers, said it had switched to 100% British on dozens of other grocery lines, including mushrooms, potatoes and seasonal spinach, bolstering its industry-leading credentials.
Aldi – one of only two supermarkets to sell 100% British lamb all year round – is actively looking to source even more products from Britain by expanding its UK supply base. It currently spends over £100m each week with more than 1,000 British suppliers, many of whom have worked with Aldi since the first UK store opened in 1990.
Aldi said it was also keen to support more British firms to grow sales with its sister operations around the world. In the last two years, it has helped dozens of suppliers to secure listings in overseas markets, including Bradford-based Seabrook crisps, which now trades with 470 Aldi stores in Australia, and Doncaster-based Sargents Bakeries, which has sold over £1m worth of its mince pies in Australia.
As the first retailer to sign the NFU’s Fruit and Veg Pledge, and the only one to sign its Horticultural Pledge, Aldi also signed a three-year partnership with the Prince’s Countryside Fund earlier this year as further evidence of its commitment to British farming and rural communities.
Hurley, added, “Our future investment plans underline our continued commitment to growing responsibly in the UK. That means having a positive and lasting impact on the economies where we operate and improving the lives of British people. Our fundamental purpose remains – to bring outstanding quality groceries at the lowest prices for our customers, creating jobs and supporting British farming and manufacturing.
“In 2020, Aldi will have been serving British shoppers for 30 years. In that time, we’ve become part of the fabric of British life. We’re proud to be reaffirming our commitment today.”