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A new competitor enters the R.I. grocery market

08:36 AM EDT on Monday, March 10, 2008

By Paul Grimaldi
Journal Staff Writer

WARWICK — It’s a little of this and a little of that inside the state’s newest food market — an outlet belonging to ALDI, a Germany-based chain now spreading through New England.

With its American headquarters in Batavia, Ill., ALDI entered New England through Connecticut seven years ago. The retailer opened its first Rhode Island store last week, at 444 Quaker Lane.

Most new chain stores are posters of sparkling efficiency.

The ALDI store in Warwick is no different, with bright lights suspended from a high, white industrial ceiling shining down on wide, neat aisles and a tile floor.

The people venturing at midweek into the food store sandwiched between a Lowe’s and a medical clinic south of Cowesett Road found a trademark ALDI store, which the company promotes as no-frills markets in which customers will usually find only one brand of an item — the chain’s own private label, or a smattering of national names.

ALDI carries about 1,300 products in markets about the size of CVS drugstores, compared with a typical supermarket that sells about 30,000 items in stores often the size of airplane hangars.

ALDI claims the small assortment keeps merchandise familiar to its customers and allows it to buy huge quantities at lower prices than competitors.

The limited assortment is just part of a cost-control strategy the company uses in its attempt to undersell the competition.

Its stores can be recognized by what they don’t have: no bakeries nor meat counters; no baggers nor food demonstrators; no asking for paper-thin prosciutto nor an extra cheese slice for a fussy toddler.

You won’t find numbered aisles — no need, even a kindergartner can count to five.

Workers keep most goods in cardboard boxes stacked not much higher than chin height, making it easy to see the whole store with a quick head turn.

In Warwick, you’ll find cold cases along the back and one side, most with glass doors to aid energy efficiency.

In the boxes and on the shelves you’ll find one size per item, gallon milk jugs, for instance, or 3-pound packs of frozen chicken breasts.

Fruits and vegetables mostly come packaged, like the asparagus in shrink-wrapped 1-pound bunches.

Like Costco, ALDI stocks a smattering of general merchandise; microwaves and kitchen goods, clothes and toys — the Warwick store sported an air-hockey table game.

It’s BYOB for many ALDI shoppers: bring your own bags. Shopping bags cost extra.

Last week, shoppers’ carts sported a variety of canvas bags and paper sacks.

There are shopping carts, but they cost 25 cents to rent. Shoppers get reimbursed the 25 cents when they turn the cart back in.

Forget coupons, for the most part. The stores don’t take checks or credit cards because those forms of payments are costly to the company. They accept cash, debit cards and food stamps.

And when you check out, the cashier isn’t going to be asking you for a loyalty card. The company doesn’t use them.

Stores employ about one dozen to two dozen people, depending on store volume. When the checkout lines get stacked up a cashier or manager rings a buzzer alerting coworkers to open another register.

Like everything else, ALDI watches the clock closely.

No midnight munchie raids allowed; the Warwick store closes at 8 p.m., Monday through Saturday, and at 6 p.m. on Sundays.

ALDI limits its advertising as well — no television and radio, apparently.

But people living near an ALDI will find store circulars in Sunday newspapers and fliers in their mailboxes.

ALDI claims its customers can save up to 50 percent over what they would pay in traditional grocery stores because of its strategy.

Right now, ALDI is selling a gallon of 2-percent milk for $2.49 versus $2.99 to $3.55 at competitors. Bananas come in at 37 cents per pound compared to as much as 59 cents per pound elsewhere in the area. Ground beef is $2.29 a pound at ALDI versus up to $3.89 in other stores.

Founded by two German brothers, Karl and Theo Albrecht, the company has been using the formula since its inception in 1948. Now, there are about 3,000 ALDI stores in Europe and elsewhere.

Since entering the United States in 1976, ALDI has grown to about 850 stores in 28 states.

“As evidenced by our growth, once people try us, they keep coming back,” said Bruce Persohn, an ALDI division vice president.

In addition to the Quaker Lane store, the company has begun construction or sought permits for stores at: 1138 Pontiac Ave., Cranston; 70 Newport Ave., in East Providence, and 539 Smith St., in Providence. ALDI expects the Cranston store to open next.

ALDI Markets

World Hdqts: Essen, Germany

U.S. Hdqts: Batavia, Ill.

Stores: Worldwide 3,000;

U.S. 850; other New England 6

R.I.: Warwick; planned in

Cranston, Providence,

East Providence

pgrimald@projo.com

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