Lidl Entering U.S. to Take on Aldi, Others

Small-format grocers proliferate, race to compete

Lidl small-format grocery

RICHMOND, Va. -- German discount retailer Lidl, a rival of Aldi, is setting the stage for U.S. expansion. The company will invest $202 million to establish operations in Virginia, Governor Terry McAuliffe has announced.

Lidl currently operates nearly 10,000 stores in 26 countries throughout Europe. It is part of the Schwarz Group, which is the largest retailer in Europe and one of the largest in the world. The small-format grocer features private-label products, but also offers branded goods.

“The market opportunities, depth of the talented job force and strategic location that Virginia provides presents an incredible opportunity for Lidl to launch its expansion into the United States,” said Brendan Proctor, president and CEO for Lidl US.

“We plan to build on the foundation that has made Lidl so successful in Europe, while creating a unique experience for American consumers that will be unlike anything else in the market,” Proctor told The Wall Street Journal.

Lidl has said it would launch in the United States by 2018.

Aldi, also based in Germany with U.S. headquarters in Batavia, Ill., already has 1,400 stores in the country. It has announced that it will launch its first stores in Southern California in March 2016, expecting to open approximately 25 stores before July 2016.

Bryan Gildenberg, head of research for Kantar Retail, told the Journal that Aldi is likely trying to expand in the United States as quickly as possible, before Lidl opens its first stores.

The news also follows Whole Foods Market Inc.’s announcement that the name of new streamlined, value-focused retail brand will be 365 by Whole Foods Market.