Discounter Aldi Süd is examining market conditions for a potential launch in China.
The news comes after German business monthly Manager Magazin reported research notes of the Aldi-Unternehmensausschuss (AUA, Aldi Company Committee), the body in which Aldi Süd and sister company Aldi Nord regularly discuss issues of mutual concern, including market entries.
The conclusion, from its meeting on 8 May this year, refers to a general resolution back in February 2013 that such a market entry would be feasible, though the particulars of the endeavour have not yet emerged.
In return, Aldi Nord may pick its next two countries to expand into, as traditionally the two fraternised companies have divided their foreign markets between each other.
Moving to China would add a fourth continent to Aldi’s network of operations, after Europe, America and Australia.
“Deciding on an emerging market like China is a first for the 100-year-old German discount operator,” says Matthias Queck, research director at Planet Retail.
However, in China, discounters still have not taken off yet, remarks Yujun Qiu, Planet Retail’s analyst for China. Largest in the sector is domestic retailer Shanghai Nonggongshang, followed by Spanish grocer Dia (formerly part of Carrefour). Both are price-aggressive neighbourhood supermarkets rather than Aldi-like hard discounters.
"The big challenge will be how Chinese consumers will react to Aldi's private label-focused ranges," Qiu adds.
Chinese consumers are understood to be sceptical when it comes to retailers’ own brands and prefer well-known manufacturer brands instead.
