Aldi low prices rocks Australian & UK markets

Aldi rock

Aldi continues to rock the Australian grocery sector, the latest supermarket survey carried out by consumer magazine Choice based on a basket of 33 items shows Aldi in front. The report says 71 per cent of Australians are worried about the cost of food and other grocery pricing.

The figures are based on the average cost of 33 items sold by Aldi, Coles, Woolworths and IGA. There are two baskets for each grocery one consisting of leading brands the other of own brands, i.e. Heinz baked beans vs. Home brand baked beans.

Leading brand product, excluding specials

• Coles: $170.54
• Woolworths: $168.74

Aldi is difficult as it sells few leading brands but getting close as possible

• Aldi $102.50

A 49/50 per cent saving shopping at Aldi. Should the consumer on a tight budget be prepared to forgo all leading brands and take the cheapest Aldi product the saving can be up to 59 per cent.

Aldi continues to prosper, while the leading duo continue the battle in which they have been engaged for decades. Choice:

“Just $1.80 (1 per cent) separated the regular prices of our leading brand basket at Coles and Woolworths, although if you include the savings from specials at the time of our shop, our basket ended up $2.85 (almost 2 per cent) cheaper at Coles.”

Choice spokesman Tom Godfrey:

“Although the big supermarkets make a lot of very loud claims about value, it’s clear Aldi is Australia’s cheapest supermarket and it is forcing the big two to compete on price.”

Woolworths and Coles attempt to tackle Aldi with their own brands, which come in 40 per cent cheaper compared with their leading brand baskets. Consumers are becoming more accepting of supermarket own brands, which admittedly have improved in recent years, probably due to Aldi.

The latest survey reveals 58 per cent of Australians think own label products are as good as brands, up from 32 per cent in 2011.

According to an article on The Daily Mail website 7 June

“Food in the U.S. is 24.85 percent cheaper than Australia, followed by the UK with 12.25 percent, according to comparethemarket.com.au.

“In Singapore food is 18.52 percent below ours, and France is cheaper by 9.67 percent.”

But it is the Daily Mail not always noted for its accuracy in reporting,

One interesting development is supermarkets promoting what are known as phantom brands, which appear to be real brands but are, in fact, supermarket-owned brands. Research indicates when one of these brands is revealed as a supermarket brand, consumers feel they have been duped.

Australian supermarket comparisons

Aldi is not only climbing the rankings in Australia, but also in the UK…

German rocket

The German invasion of the UK is going like a rocket, according to the latest figures released by Kantar Worldpanel for the 12 weeks to 21 May. UK inflation rose 2.9 per cent during the period, with the overall grocery market growing 3.8 per cent year on year, the largest increase since September 2013.

German discounters Aldi and Lidl have been star performers, together increasing their sales 19.2 per cent year on year. They now have 12 per cent of the UK grocery market. Kantar says 62 per cent of the UK population, up from 58 per cent last year, shops at one or other of the discounters. That’s an additional 1.1 million households visiting either of these stores.
The rise in prices is hurting consumers’ pockets. If it continues at the current rate, the average shop will cost an extra £119 ($205) per household, per year.

As inflation pushes product prices upwards, consumers are looking more to own brands, which showed an increase of 6 per cent, with branded product achieving just a 0.6 per cent increase.

 

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