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Aldi Rolls Out National Market Basket Study to Validate Low Prices

Aldi has always claimed its everyday prices soundly beat conventional and discount competitors alike, and now it is trying to back up that boast with a competitive price study.

 "We continue to hear a lot of talk about food price inflation," company spokeswoman Martha Swaney told Progressive Grocer, citing U.S. Bureau of Labor Statistics data that prices rose 5.3 percent in 2007, the largest increase since 1990. "With our study, we didn't just want to say 'our prices are less than our competitors,' but instead have real evidence of this," said Swaney.
To that end, the Batavia, Ill.-based U.S. division of the German-owned Aldi "went out and compared our prices with conventional and big box grocers, and we found our prices to be significantly lower," Swaney said. The research showed saving of an average $115 per month, she said.

What's more, Aldi's select brands average 16 percent to 24 percent less than discounters or big box stores, and average 40 percent less than traditional supermarkets for their store brands, the company said.

Using a traditional market basket comparison, Aldi said the national study compared the costs of a basket of 184 items generally considered to be "very important to customers," ranging from apple juice to frozen chicken breasts.

The Aldi basket averaged $286.37, vs. an average $401.47 for the combination of discounters, big box stores, and traditional supermarkets, said Swaney. Aldi customers in the Chicagoland area, for example, can get a pound of butter for $1.99, vs. $2.28 to $4.99 at competitors, as much as a 60 percent difference.

Swaney also said Aldi's $.44 per pound bananas are a much better deal than the $.69 price-per-pound elsewhere for the fruit. Ditto for a package of 80 percent lean ground beef, priced at $1.99 per pound at Aldi, vs. as much as $3.79 at competing retailers, she said.
The chain is getting more vocal and specific about its lower price claims in a bid to take advantage of the increased price sensitivity among consumers currently.

"As much as we've grown over the years, there are many who have yet to try us," said Joan Kavanaugh, Aldi's v.p./purchasing and marketing. "We invite grocery shoppers to discover the Aldi difference."

In other news, Aldi said it plans to build a $40 million, 500,000-square-foot distribution center in Denton, Texas, to support planned stores in the Lone Star state and existing ones in Oklahoma. It will be Aldi's first distribution center in the Southwest.

The retailer has no Texas stores yet but plans to open 25 stores in the Dallas-Fort Worth area in the next few years. It has 13 stores in Oklahoma. Aldi is also planning to open a new distribution center in Florida this fall.

Aldi operates nearly 900 U.S. stores in 27 states, ranging from Kansas to the East Coast; and 18 U.S. distribution centers.
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