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Aldi – Investing in E-Commerce Company Overview.

Essay by   •  February 24, 2019  •  Term Paper  •  488 Words (2 Pages)  •  13 Views

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Aldi – Investing in E-commerce

Company Overview

  1. Aldi is a German discount supermarket chain with over 9000 stores in over 18 countries.
  2. Founded by Karl and Theo Albrecht
  3. First branch in the UK opened in 1990.
  4. £600 million planned investment to expand in the UK, which will see staff double to 24000.
  5. Presently over 500 stores with plans to open 54 new stores this year and 60 next year, taking the total to over 600.
  6. Sales have risen by 36% from the previous year to £5.3 billion and pre tax profits also increased by 65% £260 million.
  7. Increased market share to 5%, overtaking Waitrose as the 6th largest grocer in the process.
  8. Recently won the Which award for best supermarket in the UK, beating Waitrose who have won it since the awards conception in 2007.
  9. Scored highly in the pricing, filling out trolley and quality categories but scored low for customer service.
  10. Low score due to long queues at checkouts and difficulty in finding staff to help with queries.

How Technolgy can help develop/grow business

  • Technology can help improve Aldi’s customer service.
  • Incorporating self-checkout stations to cater to its growing number of customers and reduce queues.
  • Means they can hire less staff to man the tills and more to answer queries.
  • Reduces shopping time for customers purchasing a small number of goods
  • Makes them more accessible.
  • Online shopping makes it easier for customers to order from the comfort of their home.
  • Aldi can also track clients shopping habits and be able to push target adverts via email.
  • Checking stock online can prevent customers making unwanted trips.

Conclusion

With its current momentum and reputation, Aldi is in a great position to gain more market share from the traditional big four. The world is becoming increasingly technology savvy and while online shopping is not going to replace in store sales it would help secure additional revenue for Aldi. Also the UK market is especially online friendly as a report has shown that UK shoppers buy food online once a month and spend a surprising five times more than in-store. The UK also has the most online shoppers in Europe. Aldi will be missing out on potential business by not investing in online shopping to tap into this market which is still growing. Online grocery market is set to grow 50% from £21 billion to £31 billion in two years as consumers continue to embrace online shopping.

As part of their UK expansion plans, Aldi should invest a fraction of the £600 million in developing an online click and collect platform. This technology can then be trialed in areas where high sales have been recorded and also densely populated areas. For a less risky investment, Aldi can install self-checkout tills in its busiest stores to help cut queues and free staff to assist customers.

        

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