Lidl: Express format called off to focus on online

Date : 16 February 2017

Lidl has called off plans to open its first multichannel Express format store in Berlin as the discounter focuses its strategy on its growing ecommerce operations.

Express store called off weeks before opening

News of Lidl's Express format plans being stopped comes just over a week after CEO Sven Seidel stepped down from his role. Perhaps this is an area where differences in strategy played a role, however it seems Lidl is clear that it wants to focus on the expansion of ecommerce through its transactional country websites. Recent news of a new logistics hub in the Netherlands for its ecommerce operations demonstrate this commitment to online growth.

Lidl's ecommerce director, Heiko Hegwein, has commented, "We are concentrating on making good things even better. We will not optimise these, bring them into the international area and generate sales." It is thought that Spain will be the fourth market for Lidl to launch online after Germany, Belgium and the Netherlands, with a possibility for ecommerce in the UK also.

58,000 sq m facility in Roosendaal

Lidl is to lease a 58,000 sq m facility from Delin Capital Asset Management (DCAM) to support its growing ecommerce offering in the Netherlands. The fulfilment centre will be one of the largest built in North West Europe this year, with construction beginning by Q3 this year. The facility is near Roosendaal, 60km south of Rotterdam Port and Europe’s largest deep-water port area.

This new development will cater to the non-grocery offering in the Netherlands that the discounter launched in June 2016. The platform follows a strategy that Lidl has already tested in Germany and Belgium. Dutch shoppers have online access to buy products such as home decor, kitchen tools, fashion and more. The delivery process is flexible; orders can be either delivered to a specified address or picked up from a DHL Parcelshop. A click and collect service would make this service even more flexible, eliminating the standard €2.99 delivery fee.

Filling a gap in the market

Commenting on the new ecommerce facility, DCAM’s Managing Director, Ekaterina Avdonina, said: “Having started as a speculative project, our ability to agree exclusivity at Roosendaal just three months from securing the project, for what will be one of the largest projects of its type in Western Europe, is a strong endorsement of our capabilities. Occupier appetite for both pre-let and speculative warehouse development schemes is unabated, as demonstrated by the strength of a pipeline that should offer significant returns on investment, fulfilling what we forecast to be a significant gap in the market.”

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Priya Chandarana is a Retail Analyst at IGD, specialising in research on the growing discount channel. To learn more about how IGD's research can benefit your business further, please get in touch - [email protected]

Twitter: @Priya_Retail