Lidl has appointed Roman Heini as its chairman, replacing Michael Aranda who will assume new responsibilities on Lidl’s management board in Europe.
Underscores commitment to US market
The appointment of Roman Heini, effective March 1, reinforces Lidl’s commitment to the US, 18 months after it entered the market. Heini joined Lidl last October from Aldi, having worked for the retailer for 18 years, including leading its UK business and serving as the chairman of the advisory board for Aldi Süd in Germany.
Focus on tackling “priority projects”
In his new role, Heini will work with Lidl US CEO, Johannes Fieber. He joined the business last summer, having previously held the same role for Lidl in Sweden. With just over 60 stores currently trading, Lidl’s progress has been slower than anticipated. However, it comes as a pivotal time having recently acquired 27 Best Market stores to support its expansion in New Jersey and New York and pushing ahead with its geographical expansion with its first stores in Atlanta. He will focus on tackling the “priority projects” which are likely to include delivering stronger growth from existing stores, raising brand awareness and looking for other strategic acquisitions to drive faster expansion.
Closer alignment with Europe
The appointment of Heini, and Fieber’s last year, indicate that Lidl’s model in the US will be more closely aligned to its European operations going forward. Lidl entered the US market with a differentiated format, operating a larger footprint and introducing a unique look and feel. However, it recently opened a store in Aberdeen, Maryland with a total footprint of 25,000 sq ft, compared to 36,000 sq ft for its first wave of US stores. The business has also flexed it property search to include leasehold sites, while the acquisition of Best Market highlighted a new route to expansion.
Aldi on-track for 2,500 stores
Aldi remains Lidl’s most formidable hard discount competitor in the US. It remains on-track to operate 2,500 stores by the end of 2022, opening 80-100 new stores each year. It has also flexed its offer to incorporate more fresh, natural and organic ranges. It is in the process of investing $5bn in the business, including spending $1.6bn to remodel 1,300 of its older stores.
Resurgence at Save-A-Lot
In addition, Save-A-Lot, the other primary hard discount retailer in the market, is also aiming to capitalise on channel opportunities. Having been acquired by private equity group, Onex Corp., in 2016 it is led by CEO Kenneth McGrath. He oversaw Lidl’s plans to expand into the US and held the CEO role at Lidl Ireland. Last year, it revealed a new-look store concept that represents a significant step forward for the business. However, for all three discounters, the greatest opportunities will come from gaining share from supermarket retailers, rather than competing directly with each other.
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