Lidl Kaufland 2016, Europe's Leading Retailer

  • ID: 3775366
  • Company Profile
  • Region: Global, Europe
  • 213 Pages
  • ResearchFarm Ltd
  • Lidl Stiftung & Co KG
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FEATURED COMPANIES

  • Asda
  • Carrefour
  • Casino
  • Coca Cola
  • Delhaize
  • Nestle
  • MORE
Who Is This Report For?

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.

What Are The Key Questions?

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

What Are The Main Topics Covered?

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.
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Note: Product cover images may vary from those shown
2 of 4

FEATURED COMPANIES

  • Asda
  • Carrefour
  • Casino
  • Coca Cola
  • Delhaize
  • Nestle
  • MORE
Executive summary

The concept

Concept: product centricity, relentless process optimisation

Concept: modernising one single format, internationalisation, buying power

A winning format: The Discounter - success factors

An introduction

Lidl: the copy cat overtaking Aldi, the original

Lidl: the brands equilibrium, Kaufland the growth driver in CEE

Lidl: OSA, Warendruck, operational independence for Lidl and Kaufland - until now?

Lidl: category management, Kaufland the most successful EU hypermarket operator

Lidl: always the second mover, threat to Tesco, more potential for Kaufland

Recent Key Developments

December 2014: Lidl launches Deluxe online in Spain

January 2015: Polish DC, creating jobs in Scotland

February 2015: Lidl focuses on Austria, renewal programme

February 2015: Lidl ramps up investment in Spain, supply chain initiatives

February 2015: Lidl starts Lithuanian expansion and invests in Poland

February 2015: Spain sales decline in 2013, Serbia, Hungary, Croatia

March 2015: Lidl changes tactics by debuting at the Paris Agricultural Show

March 2015: Sales rise in Germany, investment in Spain and Croatia

March 2015: Lithuania, heavy DC investment, Slovakia, Greece, UK, German stores

April 2015: Lidl will open 60 stores in Ireland, some on stilts

April 2015: Lidl Italia second store prototype opened, lower prices in Suisse

May 2015: US expansion - all steered from Ireland

June 2015: Swiss DC, France premiumising ranges, UK craft beer, Belgian plans

June 2015: Lidl Sweden, third profitable year in a row

June 2015: Italy investment, DC expansion in N.I.

July 2015: Lidl laying the foundation for its US business

July 2015: Lidl turnaround and growth spurt in Spain

July 2015: DC in Bulgaria, explosive UK growth revealed

August 2015: Belgium fresh promotion, vertical integration DE, Kaufland

September 2015: Italy, Finland, new stores Suisse, Croatia, UK wages, DK profits

October 2015: Lidl Italy new store prototype

October 2015: Lidl store efficiency Hungary, French DC, US DC

October 2015: Lidl reacts to Amazon Pantry by launching its own box

November 2015: Lidl UK store of the future, planning applications soar

November 2015: Lidl buys recipe bag provider Kochzauber

December 2015: New store concept in CZ, DE and POR, expansion US, SER

January 2016: Category management, US sites, reacting to Aldi Italy

February 2016: Lidl pushes fair trade in UK

March 2016: UK loyalty, Swiss minimum wage and regional products

March 2016: Lidl launches online store in Belgium, Netherlands and CZ

March 2016: Serbia, Australia trial plans, new stores in Spain

March 2016: Portugal modernisation programme to continue

March 2016: Spanish market share gains, wage rises, Denmark’s mobile payments

April 2016: Lithuania expansion, new stores in BE/NL

April 2016: Kaufland Romania, electrical cars, foreign expansion, Moldova

April 2016: Bulgarian investigation, Lidl Romania Metro promotion

Data and national KPIs

Global Retailer Top 10, $bn sales 2015, from Alibaba to Carrefour

Global Top 10 Retailers, $bn sales 2015: ranking and analysis

Schwarz: Data and KPIs

Schwarz: sales 2009-16, total & domestic growth, domestic share of total

Schwarz: benchmarks, sales, stores, space, average space, sales densities in 2015

Lidl: the most internationalised and biggest retailer in the EU

Lidl: countries, benchmarks, net sales, stores, space, sales densities in 2015 1/2

Lidl: countries, benchmarks, net sales, stores, space, sales densities in 2015 2/2

Lidl: tackling the 10,000 stores barrier again, 10 million sq m under the Lidl banner

Lidl: 2015, Top 10 markets, ranked by sales per country, per store, sales densities

Lidl: 2015, market share per country, from Slovakia to the UK

Lidl Germany

Germany: Lidl outperforms the other discount players once again

Germany: Lidl Private Label relaunch, Super 5 promotions

Germany: new concept store visits, store entrance pictures

Germany: new concept store visits and pictures: bake off station, shelf stable and fresh areas

Germany: new concept store visits and pictures: non food, check out, drinks packaging recycling

Lidl France

France: Lidl invests heavily, local produce extension, SKU count reaches 1,600

France: Lidl France premiumising, PL strategy, distancing the competition

France: Lidl tests its PL beauty brand Cien in Paris and sponsors handball

France: the transition challenge from hard discount to premium player

Lidl UK

UK: record numbers, fastest growing grocer

UK: premium private label, ‘Deluxe with Love’, fair trade

UK: Deluxe range highlights, private label range win awards

UK: £1.5bn store expansion to include self-checkouts and toilets

UK: Lidl minimum wage, advertising cooperation with the Daily Mail

UK: aggressive store pipeline and advertising budget

UK: We Love Denim and Oaklands

UK: plans submitted for DC in SW England

Lidl Italy

Italy: Lidl is reacting as Aldi enters Italy, sponsoring the Azzurri

Italy: Lidl Italia second store prototype opened, energy efficiency, Italiamo PL

Italy: Lidl Italy new store prototype, store pictures

Italy: investment plans, new DC to support aggressive store expansion

Lidl Netherlands

Netherlands: Lidl strong fresh performance, premiumisation of offer

Netherlands: online and new pilot stores

Strategy

Strategy: eight top priorities

1. Fresh & local

Fresh & local: pivot to offer quality and freshness and low price

Fresh & local: the importance of vertical integration

Fresh & local: bake off stations, meat, poultry, seafood

Fresh & local: Triple supply, replenishment costs, supply chain

Fresh & local: moving away from standardisation to localisation?

2. FMCG A brands

FMCG A brands: price wars between Aldi and Lidl in Germany, margin compression

FMCG A brands: preemptive price cuts from Lidl on potential new Aldi listings

FMCG A brands: Coordination between Lidl and Kaufland, price leadership image

FMCG A brands: signals to the FMCG majors, Aldi counter attacks

3. Vertical integration

Vertical integration: achieved in soft drinks, progressing in confectionery, the PET system

Vertical integration: vertical integration in fruit and vegetables, DCs built, owned and run by Lidl

Vertical integration: even bigger suppliers completely out of capacity when dealing with Lidl

Vertical integration: delays with the ice cream project, investment scaled up, cutting edge facilities

Vertical integration: motivation to become more independent from unreliable partners

4. Private label: non-food

Non food: Own brand development in non food, opportunity identified

Non food: The multichannel advantage of higher volumes, importance of planning

Non food: onshoring production and branding

5. Private label: Deluxe & wine

Private Label strategy: Lidl’s Deluxe, after the exuberance tighter SKU management

Private Label strategy: moving up is hard to do - difficulties with wine

Private Label strategy: Lidl’s PL relaunch of Bellarom and Milbona

Lidl: Pan-European promotion on premium wines, €349 per bottle

Lidl: range extension into wine - going for premium and luxury

Lidl: wine driving footfall to online, becoming multichannel, copying Aldi’s playbook

Lidl: using toys as footfall draw and to shift quality perceptions

Lidl: cleaning up promotional activity, Deluxe reigned back

Lidl: concentrating on the fastest sellers, cost of Deluxe missteps

6. Store update strategy

New store updates: an introduction

Portugal: modern exterior, Quality and Fresh banner

Portugal: health and beauty aisles, brand promotions

Portugal: standalone fish counter, fresh food displays, fairtrade support

Portugal: wine and spirit range

Portugal: sit-in café

France: takeaway coffee, recycling bins, making use of added space

France: mixing old and the new, toilets, flowers

France: wood effects, strong French identity

France: promotions at checkout

United Kingdom: modern Rushden store

United Kingdom: premium interior design

United Kingdom: Tooting store, more spacious

United Kingdom: bigger fridges and freezer, wider units

New store concept: the energy efficiency gains of the new model

7. International expansion - USA

USA: delays and nervousness

USA: high expectations, scheduled to start trading in 2018

USA: HQ in Arlington, Virginia, take lessons from Aldi’s US journey

USA: laying the groundwork, around 40% to be national brands

USA: new store concept, Aldi, Dollar stores will prove stiff competition

USA: Lidl US expansion - all steered from Ireland

USA: Warm welcome for Lidl, SAP HANA technology, DC construction, site search

8. Online

Lidl: online operations, huge branded non-food presence online, international

Lidl: tackling the non-food issue, easier at Lidl than at Kaufland

Lidl: online relaunch in Germany, coffee world, wine, pet foods, nappies etc

Lidl: online turnover figures in Germany

Lidl: reacting to Amazon Pantry by launching its own box

Lidl: purchase of recipe bag provider Kochzauber

Lidl: online store launch in Belgium, Netherlands and Czechia

Kaufland

Kaufland: Schwarz’s best innovation? Saturation in Germany?

Kaufland: SKU range, private labels, online retailing

Financials and KPIs

Kaufland: Countries, benchmarks, sales, stores, space, sales densities in 2015

Kaufland: sales slowdown in Germany, process optimisation, change management

Kaufland: process reorganisation leads to staff disquiet

Kaufland: still in much better shape than the competition

Strategy

Strategy: How Kaufland aims to return to growth in Germany



Store updates

Kaufland: even Kaufland is starting to struggle…

Kaufland: great modernisation programme for 50 German hypermarkets

Kaufland: trialling regional ranges and convenience

Kaufland: Non food innovation

Private label strategy

Kaufland: launches premium private label

Kaufland: “Exquisit” to strengthen image and enable uptrading

Kaufland: K-classic, a hugely successful private label line, vertical integration

Kaufland: network effects between Kaufland and Lidl

Lidl/Kaufland: supplier relationships, no traditional category management

Lidl/Kaufland: benefits of the sourcing model, supply chain collaboration

Kaufland: launching a private label at Kaufland, simplicity, simplicity, simplicity

Online

Kaufland: launches delivery service in Berlin, dark stores the right choice

Kaufland: heavy online competition in Berlin, is Hamburg next?

Kaufland: methodological approach, going head to head with Amazon

Kaufland: app, findbox innovation in store

Logistics strategy

Kaufland: the logistics secret, the potential of the return trip, eradicating empty runs

Kaufland: higher capacity utilisation and lowering overall costs, supplier collaboration

Outlook

Kaufland: kick-starting domestic growth, expansion, new formats

Kaufland: synergies across Lidl and Kaufland

Sources

Charts and Tables

Chart 1: A winning format: The Discounter - success factors

Chart 2: Global Retailers Top 10, $bn sales 2015

Chart 3: Triple supply, replenishment costs, supply chain

Table 1: Schwarz: sales 2009-16, total & domestic growth, domestic share of total

Table 2: Schwarz: benchmarks, sales, stores, space, average space, sales densities in 2015

Table 3: Lidl: countries, benchmarks, net sales, stores, space, sales densities in 2015 1/2

Table 4: Lidl: countries, benchmarks, net sales, stores, space, sales densities in 2015 2/2

Table 5, 6 and 7: Lidl: 2015, Top 10 sales per country in €m, per store, sales densities

Table 8, 9 and 10: Lidl: 2015, market share per country, from Slovakia to the UK

Table 11: Kaufland: Countries, benchmarks, sales, stores, space, sales densities in 2015
Note: Product cover images may vary from those shown
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- Tesco
- Casino
- Carrefour
- Asda
- Delhaize
- Coca Cola
- Nestle
- Pepsi
Note: Product cover images may vary from those shown
5 of 4
Note: Product cover images may vary from those shown
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