Lidl Kaufland 2016, Europe's Leading Retailer

Lidl Kaufland 2016, Europe's Leading Retailer

Release date: June 14th, 2016 (213 pages)
PDF/Powerpoint format. Price: GBP2,499.00



Our clients include:
- Global retailers,
- FMCG companies,
- Professional services companies in logistics, property and finance,
- Government institutions,
- Media agencies,
- Universities and many others.

Companies such as Tesco, Casino, Carrefour, Asda, Delhaize, Coca Cola, Nestle and Pepsi are using our thought-provoking insights to understand how future trends will impact their business.


Despite their success, discounters remain amongst the poorest understood retail formats.

Competing retailers are interested in Lidl's cost structures and strategic priorities going forward. FMCG suppliers are looking for recommendations how to sell to and partner with Lidl.

This report provides answers in areas such as:

- Lidl's new store concept and the strategy behind the premium stores
- The transition from hard discounter to premium player
- The importance of fresh ranges and premium private label
- How Lidl is moving from standardisation towards a more local approach
- What does this mean for the business model
- Analysis of Lidl's vertical integration strategy
- How to profit as a FMCG supplier when partnering with Lidl
- Why does Lidl rely on triple supply chains so much
- How does the discounter manage the FMCG majors
- What problems has Lidl had with its Deluxe premium range
- What has the discounter done to resolve some of them
- What have been the consequences of the price war between Aldi and Lidl/Kaufland
- Lidl's online strategy and how click & collect will be fitted into the new prototype store
- How the expansion into the USA will work out
- Why is Lidl so different from Aldi
- Will Kaufland return to its former strength in Germany


This is the most exhaustive and up-to-date report about the EU's biggest retailer.

We focus on Lidl's main markets individually and also review Lidl's actions month per month during the past year.

You will discover the top 8 priorities of Lidl's new strategy.

Table of contents

Executive summary p16
The concept p27
Concept: product centricity, relentless process optimisation p28
Concept: modernising one single format, internationalisation, buying power p29
A winning format: The Discounter – success factors p30
An introduction p31
Lidl: the copy cat overtaking Aldi, the original p32
Lidl: the brands equilibrium, Kaufland the growth driver in CEE p33
Lidl: OSA, Warendruck, operational independence for Lidl and Kaufland – until now? p34
Lidl: category management, Kaufland the most successful EU hypermarket operator p35
Lidl: always the second mover, threat to Tesco, more potential for Kaufland p36
Recent Key Developments p37
December 2014: Lidl launches Deluxe online in Spain p38
January 2015: Polish DC, creating jobs in Scotland p39
February 2015: Lidl focuses on Austria, renewal programme p40
February 2015: Lidl ramps up investment in Spain, supply chain initiatives p41
February 2015: Lidl starts Lithuanian expansion and invests in Poland p42
February 2015: Spain sales decline in 2013, Serbia, Hungary, Croatia p43
March 2015: Lidl changes tactics by debuting at the Paris Agricultural Show p44
March 2015: Sales rise in Germany, investment in Spain and Croatia p45
March 2015: Lithuania, heavy DC investment, Slovakia, Greece, UK, German stores p46
April 2015: Lidl will open 60 stores in Ireland, some on stilts p47
April 2015: Lidl Italia second store prototype opened, lower prices in Suisse p48
May 2015: US expansion – all steered from Ireland p49
June 2015: Swiss DC, France premiumising ranges, UK craft beer, Belgian plans p50
June 2015: Lidl Sweden, third profitable year in a row p51
June 2015: Italy investment, DC expansion in N.I. p52
July 2015: Lidl laying the foundation for its US business p53
July 2015: Lidl turnaround and growth spurt in Spain p54
July 2015: DC in Bulgaria, explosive UK growth revealed p55
August 2015: Belgium fresh promotion, vertical integration DE, Kaufland p56
September 2015: Italy, Finland, new stores Suisse, Croatia, UK wages, DK profits p57
October 2015: Lidl Italy new store prototype p58
October 2015: Lidl store efficiency Hungary, French DC, US DC p59
October 2015: Lidl reacts to Amazon Pantry by launching its own box p60
November 2015: Lidl UK store of the future, planning applications soar p61
November 2015: Lidl buys recipe bag provider Kochzauber p62
December 2015: New store concept in CZ, DE and POR, expansion US, SER p63
January 2016: Category management, US sites, reacting to Aldi Italy p64
February 2016: Lidl pushes fair trade in UK p65
March 2016: UK loyalty, Swiss minimum wage and regional products p66
March 2016: Lidl launches online store in Belgium, Netherlands and CZ p67
March 2016: Serbia, Australia trial plans, new stores in Spain p68
March 2016: Portugal modernisation programme to continue p69
March 2016: Spanish market share gains, wage rises, Denmark’s mobile payments p70
April 2016: Lithuania expansion, new stores in BE/NL p71
April 2016: Kaufland Romania, electrical cars, foreign expansion, Moldova p72
April 2016: Bulgarian investigation, Lidl Romania Metro promotion p73
Data and national KPIs p74
Global Retailer Top 10, $bn sales 2015, from Alibaba to Carrefour p75
Global Top 10 Retailers, $bn sales 2015: ranking and analysis p76
Schwarz: Data and KPIs p77
Schwarz: sales 2009-16, total & domestic growth, domestic share of total p78
Schwarz: benchmarks, sales, stores, space, average space, sales densities in 2015 p79
Lidl: the most internationalised and biggest retailer in the EU p80
Lidl: countries, benchmarks, net sales, stores, space, sales densities in 2015 1/2 p81
Lidl: countries, benchmarks, net sales, stores, space, sales densities in 2015 2/2 p82
Lidl: tackling the 10,000 stores barrier again, 10 million sq m under the Lidl banner p83
Lidl: 2015, Top 10 markets, ranked by sales per country, per store, sales densities p84
Lidl: 2015, market share per country, from Slovakia to the UK p85
Lidl Germany p86
Germany: Lidl outperforms the other discount players once again p87
Germany: Lidl Private Label relaunch, Super 5 promotions p88
Germany: new concept store visits, store entrance pictures p89
Germany: new concept store visits and pictures: bake off station, shelf stable and fresh areas p90
Germany: new concept store visits and pictures: non food, check out, drinks packaging recycling p91
Lidl France p92
France: Lidl invests heavily, local produce extension, SKU count reaches 1,600 p93
France: Lidl France premiumising, PL strategy, distancing the competition p94
France: Lidl tests its PL beauty brand Cien in Paris and sponsors handball p95
France: the transition challenge from hard discount to premium player p96
Lidl UK p97
UK: record numbers, fastest growing grocer p98
UK: premium private label, ‘Deluxe with Love’, fair trade p99
UK: Deluxe range highlights, private label range win awards p100
UK: £1.5bn store expansion to include self-checkouts and toilets p101
UK: Lidl minimum wage, advertising cooperation with the Daily Mail p102
UK: aggressive store pipeline and advertising budget p103
UK: We Love Denim and Oaklands p104
UK: plans submitted for DC in SW England p105
Lidl Italy p106
Italy: Lidl is reacting as Aldi enters Italy, sponsoring the Azzurri p107
Italy: Lidl Italia second store prototype opened, energy efficiency, Italiamo PL p108
Italy: Lidl Italy new store prototype, store pictures p109
Italy: investment plans, new DC to support aggressive store expansion p110
Lidl Netherlands p111
Netherlands: Lidl strong fresh performance, premiumisation of offer p112
Netherlands: online and new pilot stores p113
Strategy p114
Strategy: eight top priorities p115
1. Fresh & local p116
Fresh & local: pivot to offer quality and freshness and low price p117
Fresh & local: the importance of vertical integration p118
Fresh & local: bake off stations, meat, poultry, seafood p119
Fresh & local: Triple supply, replenishment costs, supply chain p120
Fresh & local: moving away from standardisation to localisation? p121
2. FMCG A brands p122
FMCG A brands: price wars between Aldi and Lidl in Germany, margin compression p123
FMCG A brands: preemptive price cuts from Lidl on potential new Aldi listings p124
FMCG A brands: Coordination between Lidl and Kaufland, price leadership image p125
FMCG A brands: signals to the FMCG majors, Aldi counter attacks p126
3. Vertical integration p127
Vertical integration: achieved in soft drinks, progressing in confectionery, the PET system p128
Vertical integration: vertical integration in fruit and vegetables, DCs built, owned and run by Lidl p129
Vertical integration: even bigger suppliers completely out of capacity when dealing with Lidl p130
Vertical integration: delays with the ice cream project, investment scaled up, cutting edge facilities p131
Vertical integration: motivation to become more independent from unreliable partners p132
4. Private label: non-food p133
Non food: Own brand development in non food, opportunity identified p134
Non food: The multichannel advantage of higher volumes, importance of planning p135
Non food: onshoring production and branding p136
5. Private label: Deluxe & wine p137
Private Label strategy: Lidl’s Deluxe, after the exuberance tighter SKU management p138
Private Label strategy: moving up is hard to do – difficulties with wine p139
Private Label strategy: Lidl’s PL relaunch of Bellarom and Milbona p140
Lidl: Pan-European promotion on premium wines, €349 per bottle p141
Lidl: range extension into wine – going for premium and luxury p142
Lidl: wine driving footfall to online, becoming multichannel, copying Aldi’s playbook p143
Lidl: using toys as footfall draw and to shift quality perceptions p144
Lidl: cleaning up promotional activity, Deluxe reigned back p145
Lidl: concentrating on the fastest sellers, cost of Deluxe missteps p146
6. Store update strategy p147
New store updates: an introduction p148
Portugal: modern exterior, Quality and Fresh banner p149
Portugal: health and beauty aisles, brand promotions p150
Portugal: standalone fish counter, fresh food displays, fairtrade support p151
Portugal: wine and spirit range p152
Portugal: sit-in café p153
France: takeaway coffee, recycling bins, making use of added space p154
France: mixing old and the new, toilets, flowers p155
France: wood effects, strong French identity p156
France: promotions at checkout p157
United Kingdom: modern Rushden store p158
United Kingdom: premium interior design p159
United Kingdom: Tooting store, more spacious p160
United Kingdom: bigger fridges and freezer, wider units p161
New store concept: the energy efficiency gains of the new model p162
7. International expansion – USA p163
USA: delays and nervousness p164
USA: high expectations, scheduled to start trading in 2018 p165
USA: HQ in Arlington, Virginia, take lessons from Aldi’s US journey p166
USA: laying the groundwork, around 40% to be national brands p167
USA: new store concept, Aldi, Dollar stores will prove stiff competition p168
USA: Lidl US expansion – all steered from Ireland p169
USA: Warm welcome for Lidl, SAP HANA technology, DC construction, site search p170
8. Online p171
Lidl: online operations, huge branded non-food presence online, international p172
Lidl: tackling the non-food issue, easier at Lidl than at Kaufland p173
Lidl: online relaunch in Germany, coffee world, wine, pet foods, nappies etc p174
Lidl: online turnover figures in Germany p175
Lidl: reacting to Amazon Pantry by launching its own box p176
Lidl: purchase of recipe bag provider Kochzauber p177
Lidl: online store launch in Belgium, Netherlands and Czechia p178
Kaufland p179
Kaufland: Schwarz’s best innovation? Saturation in Germany? p180
Kaufland: SKU range, private labels, online retailing p181
Financials and KPIs p182
Kaufland: Countries, benchmarks, sales, stores, space, sales densities in 2015 p183
Kaufland: sales slowdown in Germany, process optimisation, change management p184
Kaufland: process reorganisation leads to staff disquiet p185
Kaufland: still in much better shape than the competition p186
Strategy Strategy: How Kaufland aims to return to growth in Germany p188
Store updates p189
Kaufland: even Kaufland is starting to struggle… p190
Kaufland: great modernisation programme for 50 German hypermarkets p191
Kaufland: trialling regional ranges and convenience p192
Kaufland: Non food innovation p193
Private label strategy p194
Kaufland: launches premium private label p195
Kaufland: “Exquisit” to strengthen image and enable uptrading p196
Kaufland: K-classic, a hugely successful private label line, vertical integration p197
Kaufland: network effects between Kaufland and Lidl p198
Lidl/Kaufland: supplier relationships, no traditional category management p199
Lidl/Kaufland: benefits of the sourcing model, supply chain collaboration p200
Kaufland: launching a private label at Kaufland, simplicity, simplicity, simplicity p201
Online p202
Kaufland: launches delivery service in Berlin, dark stores the right choice p203
Kaufland: heavy online competition in Berlin, is Hamburg next? p204
Kaufland: methodological approach, going head to head with Amazon p205
Kaufland: app, findbox innovation in store p206
Logistics strategy p207
Kaufland: the logistics secret, the potential of the return trip, eradicating empty runs p208
Kaufland: higher capacity utilisation and lowering overall costs, supplier collaboration p209
Outlook p210
Kaufland: kick-starting domestic growth, expansion, new formats p211
Kaufland: synergies across Lidl and Kaufland p212
Sources p213
Charts and Tables Chart 1: A winning format: The Discounter – success factors p30
Chart 2: Global Retailers Top 10, $bn sales 2015 p75
Chart 3: Triple supply, replenishment costs, supply chain p120
Table 1: Schwarz: sales 2009-16, total & domestic growth, domestic share of total p78
Table 2: Schwarz: benchmarks, sales, stores, space, average space, sales densities in 2015 p79
Table 3: Lidl: countries, benchmarks, net sales, stores, space, sales densities in 2015 1/2 p81 Table 4: Lidl: countries, benchmarks, net sales, stores, space, sales densities in 2015 2/2 p82
Table 5, 6 and 7: Lidl: 2015, Top 10 sales per country in €m, per store, sales densities p84
Table 8, 9 and 10: Lidl: 2015, market share per country, from Slovakia to the UK p85
Table 11: Kaufland: Countries, benchmarks, sales, stores, space, sales densities in 2015 p183
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