“ALDI”Superior consumer value through strategic

channel alliances

Presented by:-Sonu Kumar

70044

INTRODUCTIONO Opened as a small food store In 1914

in Essen, Germany.O In 1948, their son took over the

business.O 1961 split their business.O First ALDI store opened in Dortmund

in 1962.O Operates in 8 countries with over

8,500 stores

Competitive AdvantagesOLimited assortment• Manage only 700-1500 SKUs• Focuses on the most frequently used

product.• No promotional strategy like no baggers,

fancy display, Customer loyalty programme etc.

• Minimum number of staff.

Operational efficienciesO Low overhead, high volume and heavy use of

private goodsO Superior relationship with suppliers.O High quality product at much lower price.O Inventory turnover is very high.

OPrivate label advantage• High quality at much lower prices

ORelationship marketing• Focuses more on its vendors than its customer.

Q1. Do you think ALDI could pursue its business model without developing strategic alliances with channel members? Discuss. No, as it is focuses more on its vendors than its customer. ALDI thinking is that customer will stick with them as long

as it provide high quality goods at the lowest possible prices.

Strategic alliances with their vendors help ALDI to encourage them to develop packages that they are easy to handle for logistic provider as well as for store.

Alliances with their private label manufacturer keep them motivated to produce high quality product which sometime exceeds the national name brand standard.

ALDI gives contract to local manufacturer for certain period of time as long as they maintain their quality.

ALDI get minimum price guarantee.Manufacturer or vendor can focus and allocate their

resources for a long period of time and effectively.

Q2. DISCUSS THE CONCEPT OF WIN-WIN IN THE CONTEXT OF STRATEGIC ALLIANCE IN

MARKETING CHANNELS.

THANK YOU