Victoria shows the way for Aldi attack

Eli Greenblat
September 6, 2012
The Age

Aldi
Australia chief Tom Daunt wants to take on the heavyweights.

ALDI Australia boss Tom Daunt has called on state governments to follow Victoria’s lead by streamlining planning laws.

This, he says, would allow the German discount supermarket, as well as any other retailer, to take on the heavyweights, Woolworths and Coles.

Big planning reforms in Victoria will see Aldi devoting more investment there as it ramps up its store network.

Mr Daunt said the private owners of Aldi, Germany’s reclusive Albrecht family, saw great potential for the supermarket chain in Australia, with the current store count of 277 to hit 300 by the end of the year and the capacity to grow to between 500 and 600 on the eastern seaboard if planning and zoning laws were freed up.

”They are enormously positive about Australia,” he said. ”I think in the long run we will have a much larger business on the eastern seaboard and a viable business in other markets.”

It is believed Aldi has a 7 per cent market share of the grocery sector in eastern capitals.

Mr Daunt said Aldi was defending its market share despite Woolworths and Coles, which had dropped grocery prices to match it and introduced new lines of private-label goods. Aldi’s non-grocery merchandise, typically clothing, homewares and toys, which made up about 20 per cent of store sales, was winning customers despite a renewed pitch by Kmart, Target and Big W to slash prices.

Mr Daunt also told BusinessDay the retailer, famous for its no-frills stores, cheap groceries and merchandise, was also planning to extend its liquor offering into New South Wales.

But it was still restricted from selling alcohol in Queensland, where it is estimated Woolworths and Coles were responsible for 80 per cent of sales.

Since entering the Australian market in 2001, Aldi has opened about 25 stores a year, but has restricted itself to eastern capitals so as not to stretch its logistics and warehouse systems.

But Mr Daunt claims Aldi could double the number of stores if planning laws across the country were loosened.

In July, Victoria’s Planning Minister, Matthew Guy, announced reforms to planning zones, allowing more uses ”as of right” and collapsing the five existing business zones into two new commercial zones.

The new zoning rules should allow easier and quicker approvals for new developments, especially supermarkets, large stores or other key commercial developments.
Mr Daunt said Aldi had lobbied state governments on the eastern seaboard to follow Victoria’s planning reforms.

Read more: