Lidl entered the US two years ago with a 36,000-square-foot store model that was significantly larger than the battle-tested box that had proven so successful throughout Europe. After these, Lidl opened development up to smaller footprints and a wider range of sites. The company opened a store inside the Staten Island Mall in December, and in January opened its first 25,000-square-foot store in Aberdeen, Maryland. Being able to scale down can help Lidl work its way into crowded markets where real estate is at a premium but foot traffic is high. With so many grocery stores dotting suburban markets across the U.S., urban markets, in particular, represent a growth opportunity for retailers.
ALDI LOCAL AND OTHER COMPETITORS
Earlier this month, Aldi Sud debuted a city store brand called Aldi Local at a new 6,000-square-foot location in south London. The move raised the possibility of the hard discounter, which is in the midst of a five-year, $5.3 billion store makeover and expansion plan, eventually opening smaller stores in the U.S. Meanwhile, Whole Foods just opened a bodega-style store in New York City’s Chelsea neighborhood, while other chains like Target, Meijer and Dollar General have debuted scaled-down stores in recent months. With its recent acquisition of Best Market stores in the northeast, Lidl showed it’s open to a variety of expansion paths. Successfully converting those locations to the discounter’s exacting standards, however, is by no means guaranteed.
LIDL EXPRESS: A STEP TOWARDS CONVENIENCE GROCERY
At the very least, Lidl Express provides a showroom to test new products and an opportunity for employees to move its thinking outside the office and into a live store. Whole Foods, Hy-Vee, Aldi, and now Lidl are but a few grocery retailers testing the success of convenience-style store formats. Without abandoning fresh food items and traditional grocery goods, major chains are guiding the industry in a new direction—but is it a path toward victory or a dead-end? Unlike the other three retailers’ stores, Lidl’s new Lidl Express, while open for business, will only be available to shoppers at its Arlington, Virginia-based headquarters, with no plans of expansion anytime soon. The new convenience-sized store is only 1,000 square feet and is Arlington’s first Lidl.