Thursday, April 28, 2011
New supermarket world to come - ALDI
LOOKING AHEAD by Wally Dobelis
Aldi, a new discount supermarket, opened its first NYC store in Rego Park Queens, earlier in the year, with another to follow in the Bronx. It is small, unobtrusive, less than one-fifth the size of a Wal-Mart, and not local, so why the interest?
Well it is different, using cost cutting technologies that should scare the pants off our familiar Food Emporium, Sloan’s, D’Agostino’s, and other large venues. Also, Aldi’s is the parent of Trader Joe’s, our already popular innovative market.
Supermarkets have traditionally been the pride of American capitalism, and their rich goods and opulent displays have turned refugees from all over the world into American wannabes. It may even be that USSR’s Premier and Communist Party’s all-powerful First Secretary Nikita Khruschev’s visit to Iowa’s cornfields and bulging supermarkets in the 1960s may have set the roots of the breakup of his inefficient Communist empire in 1989, but that’s another story.
We may be justly proud of our supermarkets, often the cornerstones of shopping center, with their ample spaces, carrying anywhere from 20,000 to 50,000 items, backed up by huge food and agribus enterprises, employers of millions, their prices held competitively low hiring migrant agricultural workers, The makers maintain huge marketing organizations, to establish brand names, produce shows and programs to push the brands, and maintain advertising agencies to utilize advertising resources, and law firms to defend the brands. The markets are the backbones of giant transportation organizations with reefer tucks, and strategic staging facilities, giant warehouses throughout the country, where producers deliver their goods, technology is used to efficiently stockpile and assemble truck loads for stores, permitting just in time deliveries, thus minimizing store warehousing.
Around 1940 in Germany some innovators, the Albrecht brothers, took over their mother’s grocery and started to modernize the operation, so successfully that now they own the world’s eighth –largest supermarket chain, 8.000 units, including 1,000 stores in the US, started in 1976 and growing, with US stores responsible for 10 percent, or $6.5B of Aldi’s gross. How do they do it?
To begin, the stores stock only 1,500 items or products, not neglecting any of the food and cleaning items; but instead of carrying , say, five major coffee brands and their regular, decaf, Columbian, Arabica, and half-caffeine varieties, constituting about 20 brands with storage, shelf space and pricing requirements, Aldis carry only two, regular and decaf. What brand? Well, their own store brand, the generic product. The same applies to all other products, the goods, whether soap or peanut butter, made by one of the large producers, anywhere. That free ride eliminates the sacred American branding, advertising and marketing overheads. The house brands take near-names and appearances of regular brands, and some few brands, such as Colgate and Splenda, continue. Unfair? Well, maybe merciless; capitalism can be really cutthroat...You have been introduced, gently, to house brands at Trader Joe’s on 14th Street, and have gained confidence in the overall store trustworthiness, softly prodded by the exotics, the new and interesting Indian, Italian and Hispanic products.
We have shopped at Aldi’s in Columbia County, 100 miles north, for five years, easily. It is in a modest income farming community served by two major chains, Shop-Rite and Price Chopper’s , and a giant Wal-Mart supermarket. The Aldi’s is an open shelf store, goods stacked in their boxes in their shelf or floor spaces, top cut open, also that of the box below, consumer ready, you take what you need. Frozen and refrigerated foods operations are more complex. Baked goods are from outside, and fruit are plastic-packed . The supermarket is run by about four youngish, well-paid athletic women, in a small shopping center. They receive the truck deliveries on sidewalk and take the cases directly to shelf, or to staging backrooms, pushing motorized stacking platforms.
Upon arrival by car, the shopper “rents” a shopping cart from a row at the entrance, for 25 cents, like renting a luggage cart in an airport. After picking the goods, you take your cart to a fast moving checkout , where your package goods are scanned in a second and dumped back in the cart. You and buy shopping bags or brown bags, or use your own, then move to the window shelf to repack your goods and take them to your car, then redeem your quarter (a little tricky, in a subway world). The store has no phone number, and keeps short one shift hours on weekends
Whether the NYC stores will have the space advantages available upstate is questionable. .Also, the labor intensive environment, saving on jobs by using generous space, may not be workable for the big cities. Our local 3rd Avenue Met store is small, and can utilize the sidewalk staging. Nevertheless, the US is bound to be one of the world’s chief food suppliers in the long run, thanks to our open spaces and good water, and the cost savings are good, to compete, also in technology and renewable energy. US cannot compete in manufacturing (we have high labor cost, low manual skills), in medical staff exports (e.g. Philippines, Cuba), in service call bureaus (e.g. India, Philippines; Ireland and the Caribbean have skill level problems), skilled metal technology (Germany), nuclear energy (France), manufacturing (China, Japan, S. Korea, Vietnam have cheap labor, good skills), carbon/oil (Saudi, UAR, Libya, Nigeria, Venezuela, Canada, Russia, Kazakhstan), Other agriproducers are Canada, Argentina, Brazil (also biofuels). The rest of the 180 world's countries have to find specialties (e.g. Finland, with cell phones, Niger with uranium), or develop more resources (e. g. Australia), exploit their tourism potentials, or lower their living standards and take low cost subcontracts. Facts don’t lie, dear grandchildren. Washington to copy, budget-cutters to memorize.
Wally Dobelis thanks NYTimes and current news sources.
Aldi, a new discount supermarket, opened its first NYC store in Rego Park Queens, earlier in the year, with another to follow in the Bronx. It is small, unobtrusive, less than one-fifth the size of a Wal-Mart, and not local, so why the interest?
Well it is different, using cost cutting technologies that should scare the pants off our familiar Food Emporium, Sloan’s, D’Agostino’s, and other large venues. Also, Aldi’s is the parent of Trader Joe’s, our already popular innovative market.
Supermarkets have traditionally been the pride of American capitalism, and their rich goods and opulent displays have turned refugees from all over the world into American wannabes. It may even be that USSR’s Premier and Communist Party’s all-powerful First Secretary Nikita Khruschev’s visit to Iowa’s cornfields and bulging supermarkets in the 1960s may have set the roots of the breakup of his inefficient Communist empire in 1989, but that’s another story.
We may be justly proud of our supermarkets, often the cornerstones of shopping center, with their ample spaces, carrying anywhere from 20,000 to 50,000 items, backed up by huge food and agribus enterprises, employers of millions, their prices held competitively low hiring migrant agricultural workers, The makers maintain huge marketing organizations, to establish brand names, produce shows and programs to push the brands, and maintain advertising agencies to utilize advertising resources, and law firms to defend the brands. The markets are the backbones of giant transportation organizations with reefer tucks, and strategic staging facilities, giant warehouses throughout the country, where producers deliver their goods, technology is used to efficiently stockpile and assemble truck loads for stores, permitting just in time deliveries, thus minimizing store warehousing.
Around 1940 in Germany some innovators, the Albrecht brothers, took over their mother’s grocery and started to modernize the operation, so successfully that now they own the world’s eighth –largest supermarket chain, 8.000 units, including 1,000 stores in the US, started in 1976 and growing, with US stores responsible for 10 percent, or $6.5B of Aldi’s gross. How do they do it?
To begin, the stores stock only 1,500 items or products, not neglecting any of the food and cleaning items; but instead of carrying , say, five major coffee brands and their regular, decaf, Columbian, Arabica, and half-caffeine varieties, constituting about 20 brands with storage, shelf space and pricing requirements, Aldis carry only two, regular and decaf. What brand? Well, their own store brand, the generic product. The same applies to all other products, the goods, whether soap or peanut butter, made by one of the large producers, anywhere. That free ride eliminates the sacred American branding, advertising and marketing overheads. The house brands take near-names and appearances of regular brands, and some few brands, such as Colgate and Splenda, continue. Unfair? Well, maybe merciless; capitalism can be really cutthroat...You have been introduced, gently, to house brands at Trader Joe’s on 14th Street, and have gained confidence in the overall store trustworthiness, softly prodded by the exotics, the new and interesting Indian, Italian and Hispanic products.
We have shopped at Aldi’s in Columbia County, 100 miles north, for five years, easily. It is in a modest income farming community served by two major chains, Shop-Rite and Price Chopper’s , and a giant Wal-Mart supermarket. The Aldi’s is an open shelf store, goods stacked in their boxes in their shelf or floor spaces, top cut open, also that of the box below, consumer ready, you take what you need. Frozen and refrigerated foods operations are more complex. Baked goods are from outside, and fruit are plastic-packed . The supermarket is run by about four youngish, well-paid athletic women, in a small shopping center. They receive the truck deliveries on sidewalk and take the cases directly to shelf, or to staging backrooms, pushing motorized stacking platforms.
Upon arrival by car, the shopper “rents” a shopping cart from a row at the entrance, for 25 cents, like renting a luggage cart in an airport. After picking the goods, you take your cart to a fast moving checkout , where your package goods are scanned in a second and dumped back in the cart. You and buy shopping bags or brown bags, or use your own, then move to the window shelf to repack your goods and take them to your car, then redeem your quarter (a little tricky, in a subway world). The store has no phone number, and keeps short one shift hours on weekends
Whether the NYC stores will have the space advantages available upstate is questionable. .Also, the labor intensive environment, saving on jobs by using generous space, may not be workable for the big cities. Our local 3rd Avenue Met store is small, and can utilize the sidewalk staging. Nevertheless, the US is bound to be one of the world’s chief food suppliers in the long run, thanks to our open spaces and good water, and the cost savings are good, to compete, also in technology and renewable energy. US cannot compete in manufacturing (we have high labor cost, low manual skills), in medical staff exports (e.g. Philippines, Cuba), in service call bureaus (e.g. India, Philippines; Ireland and the Caribbean have skill level problems), skilled metal technology (Germany), nuclear energy (France), manufacturing (China, Japan, S. Korea, Vietnam have cheap labor, good skills), carbon/oil (Saudi, UAR, Libya, Nigeria, Venezuela, Canada, Russia, Kazakhstan), Other agriproducers are Canada, Argentina, Brazil (also biofuels). The rest of the 180 world's countries have to find specialties (e.g. Finland, with cell phones, Niger with uranium), or develop more resources (e. g. Australia), exploit their tourism potentials, or lower their living standards and take low cost subcontracts. Facts don’t lie, dear grandchildren. Washington to copy, budget-cutters to memorize.
Wally Dobelis thanks NYTimes and current news sources.
Labels: ldi, Trader Joe
# posted by Wally Dobelis @ 6:58 AM 
