The battle to dominate Britain’s re-emerging High Streets is heating up with Lidl announcing plans for hundreds more stores as Aldi and Amazon also ramp up their retail presence.
The GB branch of German discounter Lidl set an aggressive target of 1100 stores by the end of 2025, creating 4000 new jobs, as it reported record annual sales of 12% to £7.7 billion. It currently has around 880 outlets.
Rival Aldi, which generated £13.5 billion in revenue in the UK and Ireland in 2020, has around 940 UK stores with an ambition to reach 1,200 by 2025.
Lidl’s latest campaign to expand its footprint into England, Scotland and Wales comes as Amazon opened its eighth free grocery store in London.
The Amazon Fresh outlet is just a few minutes’ walk from where Tesco launched its first checkout-free branch in High Holborn.
The US online retail giant introduced bricks-and-mortar in the UK in March, and is expanding rapidly, reportedly eyeing 260 stores.
Supermarkets were classified as “essential” retailers during the COVID-19 crisis and were allowed to remain open, helping boost profits. According to Kantar, the UK grocery sector is worth £133 billion a year.
Independent retail analyst Nick Babb said Aldi and Lidl “are confident about focusing on the High Street for their store-first model”.
Christian Hartnagel, chief executive of Lidl GB, told the Evening Standard: “We can see customers coming in when we open a store, and they’ve all been successful openings.”
He added: “We have a strong presence in London and will further enhance it.”
Lidl opened its first UK outlet in 1994 and now employs 26,000 employees.
Hartnagel said: “We see tremendous opportunity in the market.”
Lidl was among the businesses that made profits due to the increase in business during the lockdown.
Before the coronavirus crisis, the retailer posted a pre-tax loss of £25.2 million after huge investments.
But its GB division’s latest accounts showed the 12 months to 28 February 2021, it reported a pre-tax profit of £9.8 million. It paid out over £100 million as relief in commercial rates received.
On the challenges of the supply chain and labor shortage, Hartnagel said: “It will be a good Christmas, but it will be a much more difficult task for our teams.”