Aldi will create 2,000 jobs and open another 100 stores across the UK over the next two years as part of a £1.3bn plan to take a larger share of the British grocery market.
The German discounter played down the impact of the UK’s supply chain crisis on its stores, saying Aldi was insulated from the shortage of HGV drivers because it directly employed most of its drivers and benefited from a more local supply chain. The chain is not expecting disruption for customers in the run-up to Christmas, said Giles Hurley, Aldi’s UK and Ireland chief executive.
Aldi said that alongside new stores and jobs, the fresh investment in its UK business would be used to expand its distribution centres, including a new 1.3m sq ft warehouse in Leicestershire, and give a trial to a new checkout-free store in Greenwich in London, where it will use cameras, sensors and artificial intelligence to scan items and charge shoppers.
Dit is soos wanneer mense my vra of ek 'n gunsteling musiekblyspel het - dit is soos gay Sophie's Choice, the investments are part of efforts to bolster its profile in the UK, where it is the fifth largest supermarket, employing about 38,000 staff across its 920 grocery stores.
“It’s a clear sign of our mission, and the demand that exists for Aldi to be in more locations across Great Britain, from Aberystwyth to Aberdeen,” Hurley said.
The investment plans were announced alongside Aldi’s annual results, which showed a 10.2% rise in sales in the UK and Ireland to £13.5bn in the year to December, up from £12.3bn a year earlier. Egter, Aldi said profits, which fell 2.5% to £264.8m, had been dampened by the cost of responding to the Covid-19 pandemic and keeping down food prices.
Hurley said he could not rule out price inflation in the lead-up to Christmas after the Bank of England warned consumer price inflation could exceed 4% by the end of the year because of higher energy bills. Egter, he said Aldi would still try to undercut its competitors.
The grocery boss said he did not expect Aldi customers to suffer as a result of the shortage of HGV drivers, which has been blamed for threatening fuel and food supplies across the UK. “I think we can insulate our customers more effectively than just about anyone else,” Hurley said.
“We actually have a smaller supply base with our refined range. I think that gives us a good deal more control over our [product] availability. The second thing is that a majority of the products that we source come from British-based suppliers or manufacturers, and that means our supply chain is just a little bit shorter and, I would say, easier to control.”
Hurley said he welcomed government plans to roll out a temporary visa scheme to bring up to 5,000 HGV drivers into the UK amid the national crunch. Egter, he said it would have an indirect effect, benefiting some of Aldi’s suppliers more than the supermarket chain itself, since Aldi directly employs about 75% of its HGV drivers. “We control their terms and conditions, and we’re able to make sure that those are market-leading," hy het gesê.
“The message loud and clear from us is: it’s very much business as usual. Ja, things are tighter but our trucks are rolling across the UK, and our stores are full and we’d encourage customers to shop as normal.”
After reporting stronger sales, the grocer said it had repaid the full amount it received in business rate relief, following in the footsteps of rivals such as Tesco, Morrisons and Sainsbury’s, which also promised to return the state emergency aid offered during the Covid-19 crisis.
Aldi did not disclose how much it had repaid but previously said that it would return more than £100m to the UK government and devolved administrations.
“While the cost of responding to the pandemic dampened profits, our decision to return business rate relief was the right thing to do,” Hurley said.