---
title: "4 Years, 43 Stores: German ALDI Likely to Exceed 50 Stores in Shanghai This Year"
description: "Last week, on June 7, German hard-discount chain ALDI completed four years of operation in Shanghai. ALDI China emphasizes continuous innovation and localization, optimizing store expansion, product categories, and quality control. With more choices and better taste than convenience stores, and easier access and convenience than hypermarkets, ALDI has built its own fan base in Shanghai. An industry insider told Retail Kr Planet, \"Local retail in Shanghai has nothing new, so every district hopes for Hema to open, with ALDI as the second choice.\" He revealed that with store formats and SKUs stabilizing, expansion is easier, saying, \"50 stores this year is no problem; in the second half, Shanghai will add 10 more.\""
author: "零售氪星球"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2023-06-14"
language: "en"
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original_source: "https://mp.weixin.qq.com/s/rBIUpyQPZ_CwWVEiUacMxg"
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# 4 Years, 43 Stores: German ALDI Likely to Exceed 50 Stores in Shanghai This Year

> Last week, on June 7, German hard-discount chain ALDI completed four years of operation in Shanghai. ALDI China emphasizes continuous innovation and localization, optimizing store expansion, product categories, and quality control. With more choices and better taste than convenience stores, and easier access and convenience than hypermarkets, ALDI has built its own fan base in Shanghai. An industry insider told Retail Kr Planet, "Local retail in Shanghai has nothing new, so every district hopes for Hema to open, with ALDI as the second choice." He revealed that with store formats and SKUs stabilizing, expansion is easier, saying, "50 stores this year is no problem; in the second half, Shanghai will add 10 more."

Last week, on June 7, German hard-discount chain ALDI completed four years of operation in Shanghai. ALDI China emphasizes that over these years, continuous innovation and localization have optimized store expansion, product categories, and quality control. With more choices and better taste than convenience stores, and easier access and convenience than hypermarkets, ALDI has built its own fan base in Shanghai. An industry insider told Retail Kr Planet, "Local retail in Shanghai has nothing new, so every district hopes for Hema to open, with ALDI as the second choice." He revealed that with store formats and SKUs stabilizing, expansion is easier, saying, "50 stores this year is no problem; in the second half, Shanghai will add 10 more." In 2022, ALDI China CEO Roman Rasinger acknowledged China's market potential in a German media interview, revealing plans for a three-digit store expansion in Shanghai alone, targeting the Yangtze River Delta with strong production and consumption.

**Store Expansion: Community Stores, Shopping Mall Stores, and Flash Delivery Stations**

ALDI originated in Essen, Germany in 1913, and now operates over 10,000 stores in more than 10 countries, making it a global retail giant. In early 2017, ALDI entered the Chinese market. In June 2019, its first offline pilot stores opened in Jing'an and Minhang districts of Shanghai. Over four years, it has opened 43 stores across 13 districts in Shanghai, with 13 new stores in the last seven months. The 44th store, opened on June 10, is located at Kaiyuan Mediterranean in Songjiang, Shanghai. ALDI claims to offer "international quality at community prices," positioning itself as a community supermarket with private-label products for differentiation. A Shanghai consumer who bought ALDI products online during last year's lockdown has become a regular. He finds ALDI products high quality, reasonably priced, and different from other supermarkets. Some say that currently, half of ALDI's Shanghai stores are losing money, while the other half are profitable or break-even, "which is not easy." ALDI currently prefers locations in community commercial centers with lower rents, residential areas, or high-traffic spots near metro stations, aiming to be on customers' paths after dinner or on their way home from work. In contrast, large shopping mall stores can serve to attract new customers and build brand awareness, even with higher rents, and remain on ALDI's target list. It is said that shopping malls can provide 30% more back-of-house space, which is better for ALDI's home delivery operations than street-level stores. Retail expert Gu Guojian noted that the ALDI store on the first floor of the commercial plaza at Lianhua Road Station on Shanghai Metro Line 1 is a good place for daytime shoppers to browse, and after 5 PM, it becomes a preferred stop for commuters to buy groceries for dinner and next day's breakfast. The same-sized store achieves several times the foot traffic and sales of other stores. Besides street-side and mall stores, Retail Kr Planet found that ALDI has also tried "flash delivery stations" on the first floor of community malls, serving only online orders—with a small storefront for baked goods and evening discounts, while the rest is storage. Since its physical stores opened in 2019, ALDI has had a WeChat mini-program mall. Initially, it offered free delivery for orders over 99 yuan within 3 kilometers, now reduced to 59 yuan. Currently, ALDI also has entrances on Ele.me, Meituan Waimai, and JD Daojia. By 2021, ALDI's home delivery orders accounted for 30%. Younger generations are moving online, but online business is hard to profit from, so attracting consumers offline is ALDI's ongoing goal.

**"Community Canteen" Positioning, Private Labels as "Front"**

In the view of ALDI China's team, as a systematic foreign enterprise with high compliance costs, "competing on price is not the best approach in the Chinese market." Therefore, in China, ALDI's localization positioning is "community canteen," shedding the low-end hard-discount label, targeting the new middle class, and aiming to create a "premium community supermarket." Around this positioning, over the past four years, ALDI has focused on product categories and quality control. According to official disclosures, ALDI's private-label products have five star categories: ALDI beverages, ALDI bakery, ALDI kitchen, ALDI sweets, and ALDI dairy. These categories align with its "community canteen" positioning and strengths. "The highlights are bakery, fresh food, and hot food, with other categories as supplementary purchases. Among them, dairy, wine, and imported goods have some distinctiveness," said a retail insider. "This is the biggest localization difference compared to abroad. Abroad, it's pure discount store features; in China, it's about meeting daily meals." On Dianping, some comment, "Products with the ALDI triangle logo are safe to buy without worry." Various foods reflecting the "three meals a day" positioning, such as baked goods and light meals, include star items like German pretzels and bagels. Salads and light meals have clear price advantages over competitors and varied flavors, showing obvious localization. ALDI's light meal supplier, Bakkavor, is a global leader in fresh food production, also supplying Whole Foods and Trader Joe's in the US. Among ALDI's dairy products, the well-regarded private-label Youbai series includes A2 casein fresh milk at 28.90 yuan after discount, while other platforms sell imported Australian A2 fresh milk at more than double the price. In an April article, food media Penguin Guide commented that in the past two years, "ALDI's strengths have grown stronger (especially dairy and deli)." In particular, "Although ready-to-eat meals are now a battleground for fresh food e-commerce, ALDI's cost-effectiveness and stability in Western-style light meals still have few rivals. Prices are mostly around 20-30 yuan, rarely meeting the three major pain points of takeout: 1. Not wanting to spend too much but wanting something fancy; 2. Wanting a meal with rich vegetables and grains; 3. Wanting to be full without heavy flavors." According to its evaluation, "Two years ago, some of its fresh produce was even twice as expensive as Hema's; now it's basically on par with Hema and wet market prices." It is said that ALDI now has dozens of fresh produce bases in China. In European and American markets, ALDI stores have over 90% private-label products; in China, the proportion is over 70%, with some categories higher. For example, in the official WeChat mall, private-label wine accounts for nearly 100%, almost entirely relying on ALDI's international supply chain and global sourcing, directly procuring from multiple renowned wine regions, offering rich choices in flavor and price.

**Steady Exploration**

ALDI often takes a cautious approach when entering new markets. It does not accept external capital, refining its supply chain at its own pace before accelerating. In the US, ALDI opened only 500 stores in its first 20 years, then tripled its speed in the following 20-plus years. ALDI often surges during economic downturns when rational consumption is strong. Since the pandemic, ALDI has expanded rapidly in the UK and US, becoming the fastest-growing grocery chain in both markets in recent years. Last year, ALDI US gained 9.4 million new customers, plans to open 120 more stores in 2023, and will exceed 2,400 stores, second only to Walmart and Kroger. In the UK, ALDI aims to open 1,200 stores and has offered a "reward" for site recommendations with 10% of annual rent. In the words of ALDI UK CEO Giles Hurley, demand for ALDI across the UK is at an "all-time high." In China, ALDI's four years have involved many localization attempts, not a pure copy of the German model. In terms of speed, ALDI is still in a "steady" refinement phase. In fact, the hard-discount community store track in China is hot, with local players entering and accelerating. Hema CEO Hou Yi recently stated, "Hard discount stores are not a bubble; they are real retail skills and will replace supermarkets and hypermarkets in the future." According to Hou, Hema has opened over 20 hard discount stores and achieved full profitability at the store level. Yonghui Superstores' former CEO Li Guo recently joined Hema to lead the hard discount format. The local hard discount brand Aotle, which started in Sichuan and Chongqing, has been established for less than two years. Founder Chen Cheng revealed that by the end of last year, Aotle had opened 90 stores, plans to open over 200 new stores in 2023, and is starting national expansion. In the first half of the year, it completed 80-90 stores, with a total of 300 by year-end. Under the consumption trend emphasizing cost-performance, the booming hard discount store format has different brands with different category focuses. ALDI China appears to be still exploring, far from the acceleration stage.


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