German Supermarket Chain Aldi Keeps Expanding in the U.S.

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Feb. 26 2021, Published 12:26 p.m. ET

In 2021, German supermarket chain Aldi plans to open nearly 100 new stores in the U.S. The company also plans to expand its curbside pickup service to 500 additional stores. However, Aldi isn't publicly traded. Does the company have any plans to go public?

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Curbside pick-up has become a popular offering during the COVID-19 pandemic. Shoppers want to avoid entering stores amid the health crisis. Aldi expects shoppers to continue to seek out this alternative even after the coronavirus cases subside since it makes shopping more convenient.

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What is Aldi?

Aldi is a discount grocery chain that's owned by a German family. In 1976, the company opened its first store in the U.S. Aldi has invested over $5 billion to open new stores and to remodel existing stores. The company aims to provide the lowest prices possible on its products without compromising on quality. Aldi claims that its prices are around 50 percent lower than traditional supermarkets.

At about 12,000 square feet, Aldi’s stores are significantly smaller than a usual U.S. supermarket of about 40,000 square feet. The biggest reason behind Aldi’s low-cost model is that 90 percent of the products the company sells are its own private labels.

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Aldi’s expansion plans

In 2021, Aldi plans to open 100 new stores in the U.S. The company is focusing on adding new locations in California, Arizona, Florida, and the Northeast region. Aldi already has over 2,000 stores in 37 states. The company is on track to become the third-largest supermarket chain based on the number of stores. Aldi expects to have roughly 2,500 stores in the U.S. by 2022. The top two supermarket chains are Walmart and Kroger. In December 2020, the sales at grocery stores surged by 7.9 percent from the same month in 2019.

Aldi plans to expand its curbside pickup service for customers to 500 additional stores in the U.S. by the end of 2021. Currently, this service is being offered at about 700 stores. The company will continue to provide grocery delivery through Instacart in most of its stores. Aldi will also build a regional headquarters and logistics center in Loxley, Ala. to serve the Gulf Coast region.

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UBS analyst Michael Lasser thinks that grocery sales will drop by 5 percent in 2021. The fall is mainly because of the arrival of the COVID-19 vaccine. Also, consumers will likely transition back to eating more food away from home.

Aldi’s rival Lidl, another German discount supermarket chain, also plans to expand in the U.S. Lidl entered the U.S. in 2017 and has over 100 stores. Lidl seeks to open 50 new stores in the U.S. by the end of 2021.

Aldi isn't publicly traded

Aldi isn't listed on any public stock exchange because it's still a privately-owned company. As a result, investors can't buy or sell shares of the supermarket chain. Investors won’t find an Aldi ticker symbol on their broker’s list of stocks available to trade. A search for an Aldi stock quote will come up empty from Robinhood, Interactive Brokers, Fidelity, and E-Trade.

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