Recently, while visiting the market, I noticed a very interesting phenomenon. From leading companies to regional retailers, almost all of them have the shadow of Aldi in their private label journey. For example, RT-Mart's "Super Value" series is almost highly similar to Aldi in packaging style and category selection. There are also some regional supermarkets and convenience stores that have copied a few items as well. Swipe up and down to view ⬇️ ** **Left: Aldi's Super Value series; Right: Other brands More and more Chinese retailers are developing private labels, seemingly all on the path of "copying" Aldi. But before discussing whether the copying is right or wrong, there's a more worthwhile question to ask—Why Aldi? Why Aldi of all retailers? The Chinese market is not short of excellent examples of private labels. Sam's Club's Member's Mark is the most mature private label system in membership-based retail; Hema has been deeply cultivating its own brand products for years, with brand recognition ranking first among retailers for a long time; Pangdonglai's DL series, from mooncakes to craft beer, almost every single item triggers a wave of daigou (proxy purchasing). But why are they copying these three, not Aldi? There are three reasons. First, Aldi's hard discount model is highly referential in terms of pricing. In today's world where consumers increasingly care about value for money, the logic of "30% cheaper than branded goods, with no compromise in quality" is the story retailers most want to tell their customers. Aldi tells this story most clearly, and its price band is the easiest to reference. Second, Aldi's private label covers all categories, accounting for over 90% of its assortment, so almost every category has a ready-made reference. This means that no matter what categories your store focuses on, you can find corresponding items to learn from at Aldi. Sam's private label is a product of the membership model, and Pangdonglai's DL series is a product of strong regional attributes, both with certain preconditions. Aldi has no such threshold; its categories are complete, and you can copy freely. Third, and most crucially—the other excellent companies are too difficult to copy.

  • Sam's is hard to copy because its core is member trust, the kind of trust that makes consumers willing to pay an annual fee to renew their membership, accumulated over more than a decade of operations;
  • Hema is hard to copy because its core is a supply chain system from direct sourcing at origin to front-warehouse delivery, which is difficult to replicate without Alibaba's resources and capital;
  • Pangdonglai is the hardest to copy because its core is Yu Donglai himself and the corporate culture he has shaped over twenty years—why employees serve customers from the heart is a question that cannot be solved by a few training sessions. The core competitiveness of these three companies lies in invisible places. Aldi's shelves are visible, its packaging style is visible, and its category selection is visible. So everyone copies Aldi, not because Aldi is the best, but because Aldi is the easiest to copy. What Was Copied, and What Was Not But the problem lies precisely here. What retailers take from Aldi is category selection, packaging style, and price band positioning. These are the surface layers of Aldi's model, the results, not the causes. Aldi's real logic lies behind it: streamlining SKUs to about 3,000, eliminating all unnecessary intermediate links, connecting directly with factories, and passing the saved costs on to consumers. Private label accounts for over 90%, not because Aldi likes to put its own label on things, but because it is the core pillar of its entire business model—without a high proportion of private label, its low-price logic cannot hold. In other words, Aldi's prices are the result of its business model in operation, and private label is the means to support that result, not the end itself. You copy its product structure, but your business model remains the old one—high SKU count, traditional supplier system, and procurement-led product selection logic. The deeper problem is that copying categories is easy, but what is truly difficult to replicate is Aldi's relationship with factories. With its global scale, Aldi can establish deep co-creation relationships with local factories—customized formulas, exclusive production lines, and strict quality control systems. Factories are willing to invest for Aldi because Aldi can guarantee stable order volumes. You copy its coconut water, but your relationship with the factory remains the same game of payment terms, rebates, and entry fees. What the factory gives you will only be its most mature, standard, and least modified solution. You copied the surface, but not the essence. It is precisely the visible part that is easiest to copy and least worth copying. The Organization Not Being Ready Is a Deeper Problem Copying products is just a symptom; behind it lies a deeper structural issue—most traditional retailers do not yet have the capability to truly develop products. Private label development requires three capabilities: methodology for consumer insight, talent for product development, and supply chain relationships for deep collaboration with factories. Traditional retailers generally lack all three. Moreover, the position of decision-making power determines that this gap is hard to see. In most supermarkets, the decision-making power for private labels lies with procurement. Procurement's KPIs are gross margin and payment terms, not customer insight. When they see coconut water selling well with good margins, their natural reaction is "I'll make one too"—this decision is completely reasonable within their assessment framework. The problem is not that they made a wrong decision, but that the entire organization has never asked the truly important question: In which category are our customers settling for a choice that doesn't fully satisfy them? Starting from gross margin, you get SKUs that look good on paper. Starting from customer insight, you might get a reason for someone to make a special trip. This is also why supermarket operations cannot only look at single-item gross margin, but must look at the whole store. For Pangdonglai's DL mooncakes and craft beer, the profit on the single item is not the focus. The focus is that it makes people come specially, and after entering, they buy a whole basket of goods. Here, private label plays the role of a traffic driver, the answer to "why come here." And the value of traffic is always greater than single-item gross margin. A copied coconut water cannot answer this question. But Today, the "Window" Has Opened At this point, if you are a regional retailer, you might feel a bit frustrated—if supply chain relationships cannot be built and organizational capabilities are insufficient, is private label only a game for leading companies? It might have been before. But today's market environment is quietly changing this landscape. Overcapacity in China's manufacturing industry is a structural reality. Many factories have capacity, technology, and the willingness to improve formulas, but lack stable orders. The negotiation structure is flipping—previously retailers begged factories; today factories beg for business. This means regional retailers have the first opportunity to enter co-creation relationships for private labels at a relatively low threshold. Factories are willing to talk, willing to change formulas, and willing to customize a product for a medium-sized retailer. This is a real window of opportunity, but a window is not a moat. The threshold is lower, more people enter, but they are all connecting with the same excess capacity, the same factories, and similar formulas. If retailers don't know what they want, factories will still give them the most convenient solution. In the end, what is made is still highly homogeneous. Overcapacity solves the problem of "whether factories are willing," but it cannot solve the problem of "whether retailers know what they want." Start by Copying Aldi, But Don't Stop There So, starting your private label by copying Aldi is not wrong. Aldi is the clearest reference system in the current Chinese market. Its model is transparent enough, its categories are complete enough, and its pricing logic is direct enough. For many retailers who have never seriously done private labels, copying Aldi is a reasonable starting point—at least it makes the organization take this matter seriously. But the starting point is not the end. After copying Aldi, the real task is to return to your own store and the customers you truly serve. Look at what's missing in their shopping baskets, and see if there's any category where they are clearly reluctant at checkout but have no better choice. Find that answer, then go talk to factories. Negotiating with a real customer need is completely different from negotiating with "I also want to make coconut water." The former is co-creation; the latter is still OEM. In the four characters of "private label," "brand" is the result, and "private" is the premise. "Private" does not mean producing it yourself, but defining "why it exists"—why this product should exist, why it should exist on your shelf, and why your customers should choose it over the brand they recognize next to it. Only when you can answer this question can you truly enter the game.