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Part_1_ complete_LIDL STRATEGIC V4

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John Barlow

on 21 December 2016

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Transcript of Part_1_ complete_LIDL STRATEGIC V4

LIDL STRATEGIC
ANALYSIS

Buying
Logistics
Logistics
Merchandising
(inc. future store)

Merchandising
(inc. future store)

Property
Services
(QA/CR/CS)

Store Operations
Personnel
(inc. organisational
structures)

Personnel
(inc. organisational
structures)

Company Structure
Company Structure
Lidl Group Executive Management
(since March 2015, reports to management board)
Alexander Sonnenmoser (IT)
Christoph Pohl (Procurement)
Heiko Hegwein (Lidl digital)
Robin Goudsblom (Goods)
Jurgen Achenbach (International Marketing)

New:
Category Management Department within procurement
Alexander Lauer, Commenced Lidl 1st of April 2016
Joined from Ferrero to head up new Category Management department
Pioneered ‘Shopper Marketing’ and ‘Total Store Principle’ of category management at Ferrero
Goal to operationalise strategic direction
Knowledge to be shared with international subsidiaries

New:
Digital Marketing team, goal to explore digital opportunities for Lidl

Lidl National Head Office Organogram (UK)
Lidl Head Office Organogram- Buying
Lidl Regional Distribution Centre Organogram (UK)
Key Personnel
Kaufland CEO Frank Lehmann (left), Schwarz Group CEO Klaus Gehrig (middle), Lidl CEO Sven Seidel (right)
Sven Seidel Biography
Christine Rittner Biography
Jesper Hojer Biography
2.2.5 – Alexander Sonnenmoser Biography
Lidl International Management changes
Culture
Sven Seidel Vision
Lidl wants to be No 1 employer of choice over Google, Apple and Amazon

Lidl wants to be perceived as a good employer

Sven continues to recount how he has collaborated with the newly created team (HR) to break down hierarchical sub-structures within the company since the day he took office. The company is to become faster and more direct, enabled to better react to the major challenges of the market






Fear as a management tool? That was in the past.

At Lidl, responsibility will now be delegated – as well as trust
Five Leadership Principles
Managers are to act as ‘player coaches’ instead of leading from the side-lines, employing clear and fair communication.

We place confidence in our employees and trust that they will complete all tasks to the best of their ability, and that they will develop ideas and suggestions that will benefit our business.

We are open to changes and challenges with the aim of developing and continuously improving our business.






Together with Lidl personnel manager
Christine Rittner
, Seidel formulated five leadership principles that are to elevate cooperation at Lidl to a new level.
We enable our employees to work effectively and successfully for our business and we support our employees’ development.

We honour our agreements with our employees as a trustworthy partner.

Sven Seidel General Interests
Reportedly enjoys attending wine festivals in Switzerland
Reportedly enjoys playing golf
He loves watching football
His name is associated with the Lean-retail concept
He takes pride in how he has collaborated with the newly created team to break down hierarchical sub-structures within the company since the day he took office.
Mad about Fußball
Company Structure
The structure deliberately avoids transparency and potential takeovers
Lidl Head Office Organogram - Buying Department
Variants in Process to Aldi
Acquisition
 
Lidl are currently more aggressive with freehold acquisition prices, routinely offering in excess of £3m for sites regardless of town strength
Lidl appear to be less inclined to accept a leasehold contract than Aldi
Property Department Structure
 
A UK Property Director (UK Main Board) oversees all property matters and reports directly to the UK MD
Regional Property Directors (estimated at 3 no.) report to the UK Property Director and provide line management to the Regional Head of Property. They also hold other responsibilities (e.g. RDC site acquisition and construction)
Regional Property Managers oversee the regional acquisition and construction program
Acquisition Managers (up to 3 no. per Region) report to the Regional Property Manager and are responsible for site finding, acquisition and planning (see separate overview)
Construction
 
Lidl construct stores through Main Contracting
The Lidl Construction Manager plays an important role in ensuring the delivery of the standard store specification
Lidl engage with UK Main Contractors but have also brought over favored Main Contractors from Germany
Regional Store Openings / Rebuilds
Republic of Ireland Recent Store Openings
Heat Maps
Heat Map of Lidl UK store openings up to 20/05/2019.

Lidl are focusing on the Greater London area and having a greater presence in the Yorkshire / Humberside area.
Lidl Store Summary
Regional Distribution Centres
National Requirements
Lidl are considering a move for 16 UK Netto sites. Lidl are assessing the suitability of the sites with a confirmed closing date on applications being Friday 5th August.
National Requirements Overview
Hersham GA Plan
Lidl are becoming more innovative with their development. They are currently proposing a new mixed-use development at the Riverdene Business Park site, Molesey Road, Hersham.
Proposed Development:

Provision of a 1,407m² store.
91 free retail parking spaces including 6 disabled and 4 parent & child bays
38 residential apartments including a mix of 1,2 and 3 bed units. 

Head Office - Dublin
Lidl Ireland GmbH Main Road Tallaght, Dublin 24

Approximately 8,000 sq m.

4 storey basement building fully fitted out with offices, meeting rooms and all associated facilities.
Head Office (New) - Tolworth
Lidl have confirmed they will build a new, larger Head Office in Tolworth, South London.
220,000ft building on a five-acre site
Close to Tolworth train station and A3
Housing more than 750 employees
Expected move – 2018
Creating more than 500 new jobs

Lidl will pay the local authority £2,100,000 per acre for the land.

The site has been designed to achieve BREEAM Excellent standard. BREEAM Excellent standard is the Top 10% of UK new non-domestic buildings (best practice)
Lidl have been working with Moser Associates who completed a mapping exercise for Lidl to determine the design based on interaction between departments. This has resulted in the office design being open planned.

Lidl Concept Design & Masterplan;
Fitness Centre & Changing Area (2 floors)
Central Atrium
Open Plan offices
Coffee Bar
Staff Canteen
Roof Terrace
“Green Corridor” – electric car parking spaces
Site Plan - Proposed
Central Atrium
Views from the 2nd floor link bridge looking out onto the Central Atrium. The Atrium not only acts as a communal and corporate display space but it also acts as the vertical link between office floor and sits centrally on the horizontal linked axis.
Main Entrance
View from the main Kingston Road reception
Central Atrium
Views from the 2nd floor link bridge looking out onto the Central Atrium. The Atrium not only acts as a communal and corporate display space but it also acts as the vertical link between office floor and sits centrally on the horizontal linked axis.
Central Atrium
Views from the 1st floor within the Central Atrium. Containing break out space for informal meetings, social gatherings and corporate events.
Head Office - Wimbledon
Lidl UK GmbH 19 Worple Road Wimbledon London SW19 4JS
Other Developments
Lidl Poland (Lidl HQ)
LIDL’s new headquarters in Jankowice, in the suburbs of Poznań, required a new restaurant which would reflect the firm’s philosophy and provide a comfortable space for their employees.

Raw wood, colourful signage and tiles dominate the space and reference the atmosphere of traditional markets. Different decorative logos reference the LIDL brand.

The architects divided the restaurant into different zones with varying seating arrangements and introduced green accents to augment the natural feel and warmth of the space.



Lidl has recently introduced a trial of background music. Research shows quiet music not only relaxes customers, but also improves their well-being and affects the perception of time.

This can increase the dwell time in stores which can lead to increased basket sizes and spend.  

Potentially first developments following the creation of the Category Management team under Alexander Lauer






Performance Summary
Lidl overtook Aldi’s market leading year on year growth position in October 2015
This has since recovered in the latest 12 w/e data
Switching
Over the period where Lidl’s growth was larger than Aldi, switching losses to Lidl are experienced.
These switches are greater than expected, and reflect the risk of an ever closer approaching competitive threat to Aldi’s market position as Lidl continue to reform.
There are also smaller than expected switching gains from other retailers, which should be monitored.
Lidl Buying Approach - Overview
What do we already know about how Lidl buy compared to Aldi?
Lidl Buying Process Analysis
Lidl have a clear strategy of replicating Aldi’s range and utilising Aldi’s supply base. This allows them to take advantage of Aldi’s development work and trials, after which they usually launch a very similar product.
Lidl Buying Process Analysis
Lidl will continue to replicate Aldi's range, and as their buying department grows in the UK, they may strategically start to look ahead of us and begin to replicate the rest of the market before we do. One opportunity to defend against this is to be more agile and secretive in launching critical NPD. There is a potential to significantly reduce Aldi's critical path to enable this to happen where necessary.

Competitive Benefits

Allows Aldi to accelerate away from Lidl
Enables Aldi to quickly create the right range at key seasonal occasions
Encourages more switching from the other retailers to Aldi rather than Lidl, growing Aldi's share
Drives engagement with key suppliers through a progressive NPD programme
Consideration Points

This critical path is suitable for chilled foods, one of the categories in which both Aldi and Lidl are seeing most success. A solution would need to be found for other categories
It should be used for critical launches only
Store operational constraints would need to be overcome
This process has been developed by a chilled foods supplier, and relies on a commitment from TSPs to be able to reduce timescales of work, and buyers to accept existing factory raw materials to allow shelf life and nutritional testing to be completed quickly.
Standard Aldi Critical Path - 18 Weeks
Fastest Retailer - 12 Weeks (Tesco)
4 Week Fast Track
Lidl Buying Process Analysis
Product Launch
Below compares the critical path timelines in detail, showing where adjustments could be made to allow improvements.
International Buying – Non Food Specials
Each country has one Buying Director for Non Food Specials, and all are bought centrally in Germany.

Lidl use a buying entity similar to Aldi's Asian office, for sourcing from the Far East.

BDs from all countries meet 4 times a year to select products and place orders. Each country is responsible for meeting their turnover plan and will order accordingly.

Each country is responsible for deciding how long they want to have a product on sale for, and the target sell through rate after 1 week.

Any products left in stores can be recalled back to warehouse to be resold with a later promotion. This is controlled by the BD.

BDs have responsibility for all price change.
NFS account for approximately 13.5% of store turnover

Lidl has a strategy of favouring volume of orders over number of lines, adding to their commercial strength

The BD measures success on managing forecasted vs actual turnover and achieving week 1 sell through target of 70% (country dependent).

Based on the knowledge and expertise of Aldi's Buying Department and the findings of consumer research, we can be confident that Lidl are not finding their successes through having better quality products. However, the statistics show some figures to be cautious of.p
Product Quality
Aldi’s peak in innovation registers through 2015 with the launch of the 150 line trial. This potentially correlates with a stabilising in the decline of growth. Lidl show a peak in innovation in late 2015 to early 2016, correlating with the acceleration in their growth. This was also a period of continued vouchering from Lidl, and their first to market Christmas advertising campaign, reflecting a well co-ordinated attack. The impact of innovation is, however, short-lived.
Range Development - Innovation
Levels of innovation are monitored by Kantar, who record sales from existing product (no changes made), Existing Product Development, and New Product Development. The below chart compares Aldi and Lidl’s sales from innovation, by tier, over the past 52 Weeks. It appears Lidl have had a significant focus on Premium tier innovation, whereas standard tier is stable and consistent. Lidl have made strong % contribution progress in value tier NPD because of their low starting point. In contrast, whilst Aldi lead in total % sales from innovation, this is driven by standard tier, the largest segment of the market.

Range Development - Tiering
Premium own label is a crucial focus in all retailers – nobody is seeing decline in this area. Lidl are focusing heavily on this with almost 50% of premium own label sales coming from NPD – completely new products in the past 12 months. In contrast, Aldi at present has a similar proportion of premium OL sales coming from NPD as EPD- changes to products which have been in the range for at least 12 months. Whilst it is difficult to separate out the exact impact of this measure, it is visible in store that Lidl have focused on their Deluxe brand.
Range Development – Premium Own Label
Range Development – Value Own Label
Innovation in value tier in Lidl is also high, as the range is reasonably new and small. At present there are approximately 28 lines in the Simply range, across various categories, therefore a small amount of range development will have a greater impact on the % contribution towards spend. Whilst the contribution of innovation to the spend on value tier is currently more significant in Lidl than in Aldi, value tier is the smallest tier by value (0.4% of spend in Lidl and 3.1% of spend in Aldi). Standard tier accounts for the greatest share of spend and therefore will have the greatest impact on business performance.
Range Development – Brands
Lidl have a stronger branded presence and as a result lead in terms of their branded product contribution to sales at 11.5% (158 lines, 6.6% of total lines), vs Aldi at 8.2% (122 lines, 4.3% of total lines). However their focus seems to be shifting away from branded NPD, whereas this has increased more recently in Aldi. This is a point to consider when making specific buying decisions, however the overall contribution of branded innovation to sales remains small for both retailers at up to 15% of branded sales over the past 3 years.
Lidl list locally sourced products for specific markets in key categories:
Fresh meat and Irish breakfast meats
Produce
Eggs
Bakery
Range Development – IRE/NI
Little difference is found between the UK/IRE/NI ranges in ambient grocery, frozen or chilled foods. Where it is less viable to source a local product, for instance fresh turkey, they do not state the origin on front of pack. Several products, including fresh meat, have the ‘produced in Ireland’ logo, but are from Northern Ireland.
Range Development – Summary
Range development is one of several factors at play that will have contributed to patterns of growth over time. However, Lidl are significantly improving their customer perception of range closely behind Aldi, and are clearly closing the gap by having an ever closer range to Aldi. There still remains a significant gap to the big 4. How and to what extent we would seek to close this gap is a point for consideration if we are to continue to take share from them and remain ahead of Lidl. Aldi have a tendency to focus on the existing range over NPD. We should aim not to step back in EPD as this overtrade drives Aldi's total share, however balance this out with further focus on NPD, targeting premium own label as a key driver, to make incremental gains.
Buying Strategy: How strategic are Lidl?
Strategic Category Management - Roles
Categories where both Aldi and Lidl are showing strongest growth and overtrade are the Destination areas which are price sensitive, and lower in customer loyalty than the store average. This presents a risk of greater switching as Lidl continue to grow, but crucially an opportunity to capture further switching gains from lower loyalty shoppers of our competition. These are the categories which will drive frequency.
Key to our defence is to define category roles to understand the importance and priority of each category within the business.
Strategic Category Management - Roles
Destination followed by Preferred categories will be the drivers of frequency growth, developing higher loyalty in Aldi customers and capturing shoppers from the competition.
As proposed by the Category team, in order to drive growth in frequency we could consider a change in Aldi's discount principles which still allows profitability but weights discount in favour of Destination categories.
The below summarises how this approach would need to be taken:
Lidl have strong performance in the same categories as Aldi – Destination categories which are crucial to a customer’s decision of store
- both retailers are fighting to attract the same customers from the Big 4
Speed to market – following Aldi's range, launching products quickly after we do – they are not so far behind in their range offer as before
- increased incentive for customers to switch, advancing share ahead of Aldi
Aggressively approaching Aldi's supply base for Aldi's NPD
- easier route to market
Focus on taste matching rather than spec matching of product
- lower cost model, increasing commercial threat
Suppliers see Lidl growth rate ahead of Aldi and
choose to work with Lidl as a discounter of choice
- Challenging Aldi's supplier relationships and ability to
execute stronger ranging
Aldi shoppers are increasing their spend with Lidl
Strong improvements in scoring metrics for product quality
and range
- Risk of increased losses if this continues
Summary – Key Threats from Lidl
Summary – Threats from other retailers
It is clear that Lidl are a direct competitor to Aldi, and that this threat needs to be managed in light of recent performance figures. However, there are several reasons to be wary that the threat to Aldi may not be Lidl, but where the greatest opportunity for share gains also lies - the Big 4, Waitrose, and Marks and Spencer.
With most other retailers continuing to report negative performance and lose share, we have to consider how long they will allow Aldi to make gains and what their strategy will be.
Looking Forwards - Tiering
It is possible that Lidl’s strong performance in premium own label sales and NPD has been at the expense of standard own label, which holds the majority share of sales but has seen a steady decline in growth where other tiers have maintained performance. This should be a cautionary note to Aldi when considering future NPD strategy, as standard tier should not be ignored.
Potential future threats from Lidl:

Several ‘quick wins’ are available where Lidl have significant undertrades vs Aldi
Increase in speed to market in replicating or even bettering our NPD
Building strategic relationships with suppliers where Lidl are currently transactional
Insight from Aldi’s supply base suggests Lidl do not have a faster launch process – there are some instances where it appears suppliers have passed details of Aldi’s NPD programme to Lidl

Opportunities to defend:

Strengthening Aldi’s existing long term partnerships with suppliers and encourage a strategic relationship with only one discounter
Be aggressive in Aldi's NPD programme to widen the gap
Tendering NPD selectively to trusted suppliers
Agreeing exclusivity on new products, recipes and packaging for appropriate timeframes
Challenging Aldi's launch timeframe to allow us to accelerate ahead of Lidl and close the gap with the big 4

Shopper Behaviours – Retailer Preference
Shopper Behaviours – Switching
Aldi shares shoppers with all retailers, however their habits are changing. Whilst this year they are spending more with us and less with Tesco, Asda & Morrisons, they are also spending more with Co-Op, Lidl, Waitrose and M&S. Of these retailers, Co-Op takes the highest spend from Aldi's customers at 5%, and the combined figure is 15.9%, compared to Lidl’s 4.3%. The amount spent in Sainsbury’s has also increased. Aldi's customers still spend the most with Tesco, giving huge opportunity to gain this spend from people who are already shopping in Aldi's stores.
Shopper Behaviours – Retailer Preference
52w/e figures continue to show switching losses to Lidl. However, this returns at 12w/e
Lidl have experienced greater switching gains from premium retailers, highlighting a need to focus on capturing more of this customer demographic
The greatest financial opportunity and potential for loss is the switching from other retailers that Aldi are not achieving because it is going to Lidl.
Switching of course may be due to other factors such as store location, therefore this information may be useful for areas other than the Buying Department
Shopper Behaviours – Switching
Highlights
Aldi own 10 different types of returnable equipment;
Produce trays
Meat trays
Potato shippers
UDPs
1 litre beverage trays
2 litre beverage trays
Euro Pallets
D Pallets
UK Pallets
Plant Trollies
Lidl currently use 8 different types of equipment in store;

Euro Pallets (LPR & CHEP)
D Pallets (LPR & CHEP)
White Pallets (Lidl Pool)
2 litre beverage trays
Plastic UDP
Plant Trollies
Nestable Euro Pallets (Cabka and Pooling Partners)
Lidl SKU’s that are pallet merchandised;

4 SKU’s on Euro Pallets – 2 Additional at the front of the store
48 SKU’s on D Pallets
Merchandising Category Overviews
Fresh Meat
Lidl have focused on their British meat, POS above fresh meat products all include labelling of “We Love British”. POS signs are directly above the Chillers, which are customers eye-level.
Aldi have focused on promoting their British meat, POS above fresh meat products all include labelling of “100% British Farmed”.
POS signs hang from the ceiling above chiller space.
Fresh Meat
Lidl in Republic of Ireland use clear POS signs detailing “100% Irish Beef” and include the Irish tricolour flag, this is the same for all fast moving core range protein products.
Products in Republic of Ireland include a Bord Bia quality assured label or they will display a green “Produced in Ireland” label.
Lidl in Northern Ireland use clear POS signs detailing “100% Northern Irish Beef”. Lidl use “100% Northern Irish” on all fast moving core range proteins such as chicken and eggs, these products do not include the Irish tricolour flag. Other products are Republic of Ireland range with Bord Bia quality assured labelling.

Fresh Meat
Lidl in Scotland use Scottish flag POS behind all price card information for all Scottish products such as meat, eggs, ice cream, bread and cake products.
POS sticker on the floor by the bakery products explaining the price card POS to all customers
Scottish products are clearly visible with a Scottish Ramsay Blue Hunting background. There is also a Scottish Beef logo for all beef products.
Fresh Meat
International Lidl stores continue with the same messaging focusing on developing provenance within the local market. For example Lidl Stores in Spain use the below POS.
Select Beef
“If it’s fresh, it’s Lidl”
“Fresh from our farms”
Fresh Meat
Fresh Poultry, Beef and Lamb are all merchandised in chest chillers.
Total Linear Meterage = 30m
Fresh Meat
Linerless Label
Silver metallic ink
Gloss varnish
Red spot used on the back of pack
Deluxe range products
Specially Selected products
Reverse printed sleeve
Silver metallic ink
Basic Matt varnish
Pantone Blue
Vacuum packed product
Linerless Label
Gold metallic ink on product title
CMYK logo
Gloss varnish
Gold Foil
Matt Varnish Sleeve
Process Blue
Fresh Meat
Labelled as “British Pork”
Red Tractor label
British flag background
Red Tractor label
Product Count = 120 (mixed cases to be separated)

Unique Products = 25
(products not stocked by Aldi)

Brands Count = 0
Product Count = 146 (mixed cases to be separated)

Unique Products = 49
(products not stocked by Lidl)

Brands Count = 0
Fresh Meat
Source: Kantar Worldpanel data (Key Measures Data Table), 23/05/2015 – 22/05/2016
Lidl currently have a higher % category contribution, the main contributing sub commodities are;
62/01 Fresh Poultry = 0.50%
62/03 Fresh Pork = 0.33%
62/03 Fresh Beef = 0.36%
Market share
% spend growth
Category share
Under (-)/ Over (+) Trade £000s
% Category contribution
52 week ending data
52 week ending data
Market share
% spend growth
Category share
Under (-)/ Over (+) Trade £000s
% Category contribution
Fresh Meat
Source: Kantar Worldpanel data (Key Measures Data Table), 23/05/2015 – 22/05/2016
Lidl currently have a higher % category contribution, the main contributing sub commodities are;
62/01 Fresh Poultry = 0.48%
62/03 Fresh Beef = 0.58%
12 week ending data
Market share
% spend growth
Category share
Under (-)/ Over (+) Trade £000s
% Category contribution
Market share
% spend growth
Category share
Under (-)/ Over (+) Trade £000s
% Category contribution
12 week ending data
Uncooked Bacon, Gammon and Sausages are merchandised on the shelves, this is merchandised with Sliced Meat & Sausages. Most joints are merchandised SRP’s.
Deluxe range products are merchandised on the second and third shelf – which is eye level for the customer.
Each chiller has dividers with some sections including multiple products. This has been updated in their new stores to be merchandised in upright chillers.
Fresh juice now served in store with the produce fixture
UK Concept
In November 2015, Lidl opened a new concept store described as the ‘Lidl of the future’. The store in Rushden, Northamptonshire U.K opened at a fit-out cost of £2 million. At 1,400m, the store is one of the largest in the UK estate, significantly larger than the average Lidl size of 1,000m
Glass frontage allows more light as well bringing energy costs down, which is matched with low level, LED interior lighting

Trolley bays have been moved to the car-park to further open up the entrance area and create feeling of space

Totems advertise fresh bakery in addition to services such as toilets and free parking

Part of a £1.5 billion investment in the U.K over next 3 years ramping up new openings to 50 per annum, all of which are to follow this format
UK Concept
A warm welcome to Lidl at the store entrance

Positive approach to customers enhanced with bicycle shelters, additional navigational signage and Lidl branding on glass
New format is step change with in store bakery a focal point, dedicated 80m preparation room providing 35 SKU’s of fresh product to entice customers entering store and providing real differentiation from competition
A large fresh bakery is encountered immediately on entering the store

Immediate sensory impact both visually and via fresh smell

Much of the bakery items are sold loose to emphasise freshness
Other features include the adoption of a new dark grey colour scheme and POS which helps to portray a more quality-orientated, sophisticated and cleaner image.
UK Concept
The larger size of the store, has allowed it to introduce wider aisles at 2.7m, a larger produce section (40% larger than previous) brought to the front of the store and an expanded BWS offer, all enhanced with open ceilings and the removal of hanging boards.
UK Concept
Produce is displayed on ‘fresh’ branded wood-style crates.
The expanded produce has been moved to the front of the store, next to the bakery
Premium BWS fixture incorporating points based wine guide and a craft ale section

Selected range in crates adding premium feel

Individual bottle divider system ensuring sharp displays with accurate POS location

Self check-out zones and a modification of existing tills allowing customers to pack whilst cashier continues to serve, further evidence of mind-set change to meet customer needs
There are six self-service checkouts, supervised by one member of staff

The addition of self service demonstrates Lidl's desire to embrace customer trends within national markets

UK Concept
Chilled island , similar to what is found in more mainstream UK supermarkets such as Tesco, Sainsbury’s and Waitrose

Move away from chest chillers with vertical chill space finished with premium colours
Expanded space for key growth categories with the focus on fresh; Meat, Fish, Bakery & Produce

These categories are stronger focal points as a result; the bakery creates a feature front of store whilst fish is now located in a stand alone chiller to give focus

Crucially it is the space not the range which has changed to create the new concept

UK Concept
Low level LED and wider aisles improves the shopping experience, while replacing the typical yellow and blue colour scheme with dark wood and black signage gives a more upmarket impression
Lower Specials tables and removal of price board for specials adds to the feeling of space

Wood effect surrounds on NFS tables removing wire ‘cage’ look

High level category headers directing customer journey through store

UK Concept
For legal reasons alcohol cannot be merchandised outside of segregated area – thus none on flexible 4 tier special shelving
International Concepts - Ireland
Ireland – Local brand names offered in addition to category headers – reinforcing provenance message
Increased ‘Just Free’ & whole foods offering.
Non Food given category headers to help facilitate customer mission
Bakery and food to go sections have adopted the lighter wood finish trialled in Switzerland

Additional POS space dedicated throughout store highlighting Irish provenance of key core range commodity groups
International Concepts - Ireland
Latest new format store in Gorey has the addition of ‘Lidl to Go’ range seen elsewhere in Europe, with hot prepared food backfilled adjacent to in store bakery
Additions to bakery include; loaf slicing machine and wall mounted menu detailing all product ingredients, giving additional premium feel

Additional ambient meat section catering for local market in Spain and Spanish islands such as Lidl Majorca
International Concepts - Spain
Current trial of enhanced Health and Beauty fixture focussing on Lidl ‘Cien’ brand
International Concepts - Spain
‘Lidl to go’ range offering hot prepared food. Back filled display adjacent to in store bakery

‘Pick n Mix’ style frozen shell fish self served by customers from chest freezers
International Concepts - Spain
Exterior signage has adopted a ‘softer’ approach whilst consistently inviting customers to comment or contact Lidl via a variety of social media platforms
International Concepts - Spain
International Concepts - France
Bread fixture has addition of plastic covers, with product only accessible via designated scoops rather than by hand to minimise customer handling of product and improve perception of quality
Existing store refurbishment taking place in line with new store format.

Part of a project to invest €450 million over 5 years refurbishing 900 of Lidl’s 1,500 French stores
Trial of lighter wood effect on bakery with a slightly changed bread menu, fixed to pillar behind perspex cover
POS surrounding office door dedicated to celebrity chef endorsement
Additional gondola end wine fixtures in keeping with lighter wood grain as per rest of store
Trial of electronic HD screens in place of paper POS and poster frames

Dual customer tills, allowing customer to pack whilst another is served
International Concepts - Switzerland
Free electric car and bicycle
charging points in car-park

Dedicated merchandising space to Lidl ‘Bio’ range of organic products
Entrance areas in Switzerland have added recycling points in welcome wall for customers, In addition to local picture and welcome message
International Concepts - Switzerland
To do this Lidl will focus on its private labels, benchmarking its ranges against those of Monoprix in France and Migros in Switzerland to make sure that it is offering a quality product at an affordable price
International Benchmarks – Migros
Frederic Fuchs CEO of Lidl France, detailed to Le Monde that Lidl was aiming to change shoppers' perception of the retailer and its products. This has been rolled out at a national conference of French store managers
Founded by Gottleib Duttweiler in 1925 Migros is SWI largest retailer and employer
Founded on selling just 6 basic foodstuffs to households who struggled to have access to markets it has expanded considerably so that now 99% of SWI households either shop at Migros, go on holiday with Hotelplan or bank with Migros

Founded on a concern for health and wellbeing of customers, Migros does not sell alcohol or tobacco
0.5% of turnover is dedicated to social and cultural projects making Migros industry leaders in many areas of CR
If EBIT surpasses 5% retails in stores are lowered

Pioneers of the self scanning system, developed with Polygon in 2009. The aim is to remove the need to queue or to pack in store, which in feedback given highlighted these as the two biggest frustrations of customers

Named ‘Subito’ up to 20% of customers are now users accounting for up to 40% of store turnover, rising to 50% in busy periods depending on location. All target throughput times have been broken in ‘Subito’ stores

International Benchmarks – Migros
Incumbent French discounter with quality focus on both food and non-food
Now part of the Casino Group
International Benchmarks – Monoprix
Store layouts have non-food on entry, focussing on textiles and health & beauty
Fresh produce is a key focus for the business,
Trial of self scanning system in stores
Fresh juice now served in store with the produce fixture
Focus on fresh and provenance is the consistent message throughout the store
International Benchmarks – SuperValu
Trial of self scanning system in stores
Focus on fresh and provenance is the consistent message throughout the store
International Benchmarks – SuperValu
280 local suppliers now part of the SuperValu ‘Food Academy’ programme

Supporting over 1,100 Irish jobs with 85% of participants now claiming they will be recruiting over the next 12 months
Largest grocery share in Ireland at 23% with 2.8% year on year growth

This has predominantly been driven across fresh categories , produce, meat and fish as the market has moved toward higher frequency shops
Business claim that over 70% of products are now sourced or produced in Ireland
1,900 SKU’s spread across 3 tiers; Daily Basics, SuperValu Range & SuperValue Signature Tastes
UK Concept
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