Aldi Business Strategy

1505 Words7 Pages
The Albrecht Family store was founded in Essen Germany in 1913. It faced stiff competition in its earliest start up days. In order to stay afloat and beat the competition, the store had to cut prices in as many places as possible while also ensuring that their quality was kept with their standards. By 1955, that business practice allowed them to expand to more than 100 storefronts. That winning formula has allowed Aldi to grow and develop into a massive corporation with nearly 1,600 stores in the U.S.A alone. They keep everything running incredibly efficiently, and have changed a large part of their business models in order to better fit the world today. However, even though they have changed a lot of their business they have found a way…show more content…
Everything Aldi does is focused around providing its customers value for money. Due to their cost focused competitive strategy, Aldi is efficient and cuts costs, so they can then invest profits back into the business. They can then be used to further meet its business objectives for growth. Aldi uses four strategies in their cost focused agenda, which hare time-based management, continuous improvement, just-in-time production, and volume purchasing(BusinessCaseStudies). Primarily, Aldi uses time-based management to reduce the time wasted in business operations through the use of their multi-skilled and flexible workforce. Continuous improvement is part of Aldi's culture where all employees are constantly involved in making improvements to quality. Just-in-time production is important to Aldi's competitive strategy because they receive materials just as they are needed, thus eliminating the need to maintain large stock levels. Most importantly, volume purchasing lets Aldi buy much larger quantities because they sell fewer variations of each product. This enables it to take advantage of economies of scale and source products more cost effectively. These methods of a cost focused strategy have helped Aldi become the nation's value leader for seven consecutive years and have 42 million shoppers shop at their stores every…show more content…
Aldi is a brick and mortar store focused on selling goods in a cost-efficient way for consumers who are conscientious of how their money is being spent. Gathering supplier connections, property, and infrastructure to do so takes a substantial amount of time and money. This makes it challenging for new companies to enter into this market. Aldi has spent its lifetime as a company focused on these values, ensuring they cut costs at every corner. Investing in their employees also gives them sound infrastructure to rely on as they continue to expand their business. As they expand, they decrease threats of future new

More about Aldi Business Strategy

Open Document