Germany’s Lidl plans to open its first U.S. stores on
June 15, beginning a rollout that will eventually carry the chain that promises
deep savings over existing stores’ offerings into Philadelphia and its suburbs.
Lidl’s initial U.S. locations will be in South Carolina,
North Carolina, and Virginia, Brendan Proctor, president and chief executive of
the store’s U.S. operation, said at a Tuesday evening news event in New York to
introduce some of the chain’s merchandise.
Lidl (rhymes with “needle”) will open a total of 20
stores in those three Southern states, with 80 more shops – including ones in
and around Philadelphia – expected to begin operating by mid-June of 2018,
Proctor said.
“We have sites secured from New Jersey down to Atlanta,”
he said. “We’re agile as a retailer. We’re able to adapt. We learn from the
markets we’ve gone into.”
Lidl Stiftung & Co. KG, a unit of the Schwarz Gruppe
grocery conglomerate, operates about 10,000 stores in 27 countries, where the
44-year-old chain is best known for its low prices.
Even before its U.S. opening, the company seems to be
having an impact here.
Wal-Mart Stores Inc. chief executive Doug McMillon said
in a Wall Street Journal article published this week that the Bentonville,
Ark.-based retailer is refining its lineup of store-brand products and lowering
some prices ahead of the expected onslaught by Lidl and other competition.
Indeed, Lidl is seen to be eyeing Philadelphia-area sites
in close proximity to Wal-Mart stores, including locations in the city’s Port
Richmond neighborhood and in Cherry Hill.
The company has confirmed no particulars about its plans
for Southeast Pennsylvania and South Jersey, and Proctor declined to discuss
when stores in the area might open, citing uncertainty over permitting
processes and other issues.
But he did share a few details about the chain’s general
approach, saying about 90 percent of stores’ inventory will be “private label”
merchandise that vendors produce specifically for Lidl, with remaining
inventory coming from known brands.
The chain will also periodically introduce nonfood items
for short-term sale to sustain customers’ interest, Proctor said. Sample “Lidl
surprises,” as they are known, could include yoga pants, lawn mowers, and
leather jackets, he said.
Food will be about 85 percent U.S.-made, with the rest
imported largely from Europe. A selection of these goods – presumably making up
some of the chain’s higher-end offerings – were on display for reporters
Tuesday.
Arrayed were cheeses that had recently won a string of
awards at a Los Angeles competition, and smoked salmon and scallops that were
certified to have been sustainably raised, as Lidl officials said all the
company’s seafood will be.
Also on display were U.S.-cured salamis that were
produced following European methods (lower heat for longer periods) and
Italian- and Spanish-made Prosciutto di Parma and Serrano ham.
“Everybody’s a foodie now,” said Food Network regular
Amanda Freitag, who spoke at the event, for which she prepared snacks using
Lidl products. “It’s really important to give people access to high-quality
products at decent prices.”
Proctor said Lidl is able to do that through practices it
has refined over decades.
Some of its cost savings are achieved by limiting the
assortment of items on its shelves to just a few variations, most of which were
developed in close collaboration with vendors, Proctor said.
A similar approach is taken by Aldi Inc., another German
discounter against which Lidl already competes at home and in other markets, as
well as by Trader Joe’s, which is also run by a German parent.
Proctor said that another of Lidl’s money savers is its
standardized approach to its operations, with all of its U.S. stores to be of a
near-identical design, with just over 20,000 square feet encompassing six
aisles.
The company is also fanatical about eliminating waste, he
said: Bread arrives at the store partially baked and frozen and is prepared
fresh throughout the day as needed, to keep loaves from going stale and being
discarded. Produce is kept fresh by rotating pallets from the bottom up, rather
than arranging them in bins, so that older fruits and vegetables are not left
to linger.
“We try to work with a model, with a system,” Proctor
said. “We measure everything.”
Source: Philly.com
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