Aldi Suisse cuts back on non-food

By: Rennack Sebastian Date: 2024. 09. 19. 09:31

Aldi in Switzerland introduces major adaptations to its store layout. The discounter reduces the floor area of non-food promotions due to falling demand. In return, Aldi allocates more space for fresh products, regional specialties and organic items. The new concept aims to strengthen Aldi’s value proposition against the market-leading duopoly of supermarket operators Migros and Coop.

Aldi Switzerland is redesigning its product range to focus more on ambient and fresh food.

‘We have been observing a declining demand for non-food items for several years. We have therefore reduced our promotional product range in favor of our core food business’,

announced Jérôme Meyer, Country Managing Director of Aldi Suisse, in a company statement.

According to the GfK Market Monitor, the Swiss retail sector as a whole recorded a slight growth of 0.9% in 2023. The food and near-food categories grew by 3.3%, while non-food declined by 2.5%. In line with the market researchers’ findings, Aldi cites declining demand for non-food promotions and a shift from offline to online shopping for non-food as reasons for the concept change. For the second quarter of the current year, the latest available, the negative dynamics for non-food increased to -4% year-on-year.

Aldi is using the free space to expand its food range. Thematic areas such as Asia, Mexico, the Balkans and Iberia have been given a permanent place. Special attention will continue to be paid to fresh foods such as fruit and vegetables, regional specialities and organic products. The frozen food area has also been expanded.

In order to compete with the large domestic supermarket operators Migros and Coop, Aldi plans to expand its own organic brand ‘retour aux sources’ (back to our roots) to more than the current 60 products. The private label introduced in 2022 meets higher quality standards than the EU organic or Bio Suisse guidelines. In addition, Aldi’s own regional brand ‘Saveurs Suisses’ (flavours of Switzerland) already includes more than 100 products, with the range having tripled since its launch two years ago. At the beginning of the year, Aldi Suisse launched a fresh food offensive and announced a 25% increase in its fruit and vegetable range.

Aldi Suisse takes the number 3 position in Switzerland’s national grocery ranking and has to stand its ground against established domestic players several times bigger than the German discounter. Market leader Migros achieved a net revenue of 13.2 billion Swiss Francs (CHF; 14.1 billion euros) with its supermarket formats and 3.9 billion CHF (4.2 billion euros) with its Denner discount chain. The second-largest food retailer Coop generated 11.8 billion CHF (12.6 billion euros) with its supermarkets. Aldi’s net revenue for the past year is estimated at close to 2.5 billion CHF (2.7 billion euros).