German Supermarket Chain Aldi to Expand into South, West Australia

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By Esther Tanquintic-Misa | February 13, 2013 1:00 PM EST

German supermarket chain Aldi has plans of adding as many as 110 stores across South and West Australia as it boosts its 300-strong supermarkets portfolio all over Australia.

The expansion in SA alone is seen to create more than 900 new jobs in the state from the proposed development of 40-50 new stores. About 50 to 60 stores are meanwhile planned for WA.

However, Aldi said it may take some time for it to organise a warehouse and store locations, so it could still be a few years, perhaps "two or three years" to open stores in the two states. 

Aldi opened its first Australian store in Sydney in 2001 where most products were offered in large cardboard boxes and pallets.

"What is generally good for the market is more competition, which will lead to competition on price and an extended range of products," Alan Kirkland, chief executive of consumer group Choice, was quoted by The Australian.

"We've seen some products where Aldi has driven down the price by a very large amount. There will be pressure on other supermarkets to come down to those prices and Aldi can have a significant impact."

Aldi, according to estimated, now control 5 per cent of the supermarket sector market share.

Nick Xenophon, SA independent senator, warned Aldi's expansion into his home turf could hurt local farmers and food processors.

"Also, if you squeeze out independent retailers with an unsustainable price war, it will lead to greater concentration of ownership at the expense of local businesses," he said.

But Tom Daunt, Aldi Australia managing director, said they source their produce right here in Australia. He said 100 per cent of Aldi's fresh meat, 94 per cent of its chilled dairy and 97 per cent of its fruit and vegetables were Australian sourced.

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