Shaky Fundamentals Prompt Aldi's Expansion Move

Domestic expansion is at the top of the agenda for German-based discount retailer Aldi's Australian business, whose product range largely consists of private labels. The retailer, which has 265 outlets in Australia, is expected to open between 25 and 30 stores in the country in 2012 and will be focusing its expansion on the eastern states of Australia. With domestic demand uncertainties lying ahead in 2011, Aldi is clearly looking to take advantage of a period of softened consumer confidence, which should work well for its lower-value offerings and private label goods. Over the longer term, the shift of consumption habits towards private labels will continue to pick up momentum, and Aldi should find itself better positioned to exploit this trend with an expanded domestic scale.

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