BUDGET SUPERMARKETS: THE SUCCESS STORY CONTINUES

Are you a thrifty shopper? If so, you probably know all about Lidl and Aldi already. If not, you need to get on board.

I knew these were places you could get German products that were either unavailable or very expensive in other stores. From my years of work travel to Scandinavia I have become a major fan of gravadlax; I could live on the stuff. Aldi and Lidl have it at silly prices, though Aldi call it something else: marinated salmon or similar, which is what it is. That’s “a rose by any other name” and it tastes as good; there’s probably a law that says you have to charge a lot if you call it gravadlax, because that’s a luxury item, surely?

And they have loads of budget booze, including very drinkable wine at good prices, as I discovered at Christmas.

Anyway, enough of the plug, already, because they don’t need it, according to the latest retail data. The Daily Telegraph (14 Feb) says that in the four weeks to February 2, the four big supermarkets lost market share. Sainsbury’s sales grew by just 0.1% compared to last year, while Asda fell 0.7%, Tesco 0.8% and Morrisons by a staggering 4%. At the same time, Aldi grew sales by 37.9% and Lidl by 16.4%. In just four weeks.

OK, Aldi has not yet achieved the dominance it has in Germany, its home market. According to latest market data, it controls 3.7% of the UK grocery market, compared to 30.2% for Tesco. So these budget supermarkets are still much smaller … but that shouldn’t bother us, provided there’s a store near enough to make the journey worthwhile.

Those two stores have another distinguishing feature; you might go in for a bottle of cheap wine and come out with an angle-grinder too. That’s because, in addition to all the food and drink products, they also have a random selection, frequently changing, of other stuff. That’s the story as told by the Irish pub singer Mick MacConnell: Ballad of Lidl and Aldi

WANT TO KNOW MORE?

For the Daily Telegraph article, click HERE.

IN PRAISE OF MANUFACTURING

A most interesting piece on the Today programme this morning, (about 07:15, if you want to find it on iPlayer) about the importance to our economy of the manufacturing sector in general and of small businesses in particular. I switched on part-way through but the interviews I heard were with companies in the Jewellery Quarter in Birmingham; they were honoured in this way, not doubt, solely because the Conservative conference is in the city right now. The excellent presenter (James Naughtie, I think) and his interviewees together made the point that successive governments and the banks have failed to provide the environment where manufacturing could prosper (it’s now a shamefully small proportion of GDP) but that fact has been known for years. But their final clincher was one that had previously escaped me, obvious though it may be to you, dear reader: other things being equal, (which they never are) every new job created in manufacturing will contribute to the creation of far more jobs in supporting businesses than any new job in the service sector. Maybe this fact has always been obvious to the German government and that’s why both their small / medium business sector and manufacturing have been supported by more than words and maybe that’s why their economy is both more healthy and more sustainable than ours.

We’ve often been told about the “trickle-down” theory, i.e. that increased wealth at the top will trickle down to those lower in the food chain (does this justify those massive banking-sector bonuses? Discuss). Maybe it works, maybe not, but this morning’s message about the crucial importance of our manufacturing sector could be called the trickle-round theory. Or the ripple theory. Whatever we call it, I hope that Messrs Cameron, Osborne and Cable were listening to the radio at the same time as I.

Sadly, after that excellent segment normal service was resumed; a piece about Sainsbury’s increased profits followed by one about the will-they won’t-they sale of Liverpool Football Club. The football story was repeated at least four times, I think, between 7:30 and 9:00; the manufacturing story was not. Perhaps that shows where our national priorities lie. No wonder the country’s in the same kind of debt crisis as Liverpool FC but, unlike them, we don’t have an American white knight on the horizon.