China: Aldi a big success outside Shanghai
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China: Aldi a big success outside Shanghai

Updated: May 8

Discount Retail Chain ALDI China is virtually "overrun" in the Chinese community of Wuxi (CN) with 7.5 million inhabitants. Full shopping carts and masses crowd through the aisles.


Expansion beyond Shanghai: new frontiers

Building on its success in Shanghai, Aldi is now poised for broader expansion. On April 19, the retailer opened two new stores in the neighbouring Jiangsu Province cities of Suzhou and Wuxi. Shopping habits in both places are similar to those in Shanghai, enabling Aldi to build on its success here easily.


However, as Aldi expands further, especially beyond the eastern Yangtze River Delta region, it may face increased competition. Local players like Freshippo and Dingdong Outlets, which are adept at catering to Chinese consumers, could adopt similar strategies. As Aldi operates 65 stores in Shanghai, Freshippo operates 60 stores with private-label products accounting for over 50 percent of its offerings. The retailer has also worked hard to expand its range of daily necessities, positioning itself as a strong competitor in the convenience, value-driven retail space.


To maintain momentum and thrive in China's diverse and rapidly evolving market, Aldi must fine-tune its region-specific offerings and strengthen links with local suppliers. China's vast food culture varies greatly from region to region. A "one-size-fits-all" approach will not suffice in a nationwide market of divergent consumer expectations.


For example, products popular in Shanghai, such as locally brewed craft beers, may not resonate as strongly in a city with a more traditional cultural identity, like Guangzhou.

In northwestern cities like Xi'an, where the cuisine leans heavily on wheat-based products, Aldi would need to expand its selection of noodles and breads. In Hangzhou, a city famous for its tea, more tea-related products should be on the shelves.


In southwestern cities like Chengdu, locals prefer spicy cuisine, so Aldi would have to adjust its product lines to include more Sichuan-style flavours.


Rethinking retail: Aldi's playbook

So, what's behind Aldi's success? A good understanding of local tastes and shopping habits. The retailer has redefined the supermarket experience by offering not just products, but shopping experiences tailored to Chinese consumers.


Aldi's innovation shines in its fusion of Western and Chinese flavours. Take its Sichuan-style spicy crayfish salad, a ready-to-eat dish that blends the bold, fiery essence of Sichuan cuisine with the widely loved Chinese crayfish. This fusion exemplifies Aldi's ability to combine local culinary traditions with its signature, streamlined offerings. It's just one of many ways Aldi has adapted its products to local tastes.


Moreover, Aldi's store design feels unmistakably Shanghai. The minimalist interiors, featuring natural wood finishes and contemporary touches, create an atmosphere that blends urban sophistication with a warm, welcoming vibe.


Unlike the sterile, warehouse-style discount stores typically seen in the West, Aldi's Shanghai locations have become local gathering spots. Their modern yet cosy aesthetic, reminiscent of chic local cafés and boutique-style stores, appeals to urban professionals who value both practicality and visual appeal.


Tech-savvy retail power

Shanghai's consumers are among the world's most digitally connected shoppers, and Aldi has tapped into this trend. The retailer introduced "scan-and-go" technology via its WeChat mini-program, allowing customers to bypass traditional checkout lines.


This aligns perfectly with the city's demand for frictionless, tech-enabled shopping. Aldi has also introduced a home delivery service that ensures products are delivered within a 3-kilometer radius in under an hour. This level of convenience highlights Aldi's dedication to adapting to the tech-savvy lifestyle of Chinese shoppers.


Aldi's commitment to local sourcing is another key element of its success. More than 80 percent of Aldi's products are sourced from Chinese suppliers. This not only supports local businesses but also ensures fresher products with shorter supply chains.


Aldi's private-label products make up nearly 90 percent of its inventory, eliminating the middleman and keeping prices low while ensuring product quality. This is vital in a price-sensitive, increasingly discerning market like China, where consumers trust Aldi to provide great value without compromising safety or quality.


Watching the bottom line

As Aldi continues to expand, it also faces the ongoing challenge of balancing profit margins with store growth.


The discounter will need to keep prices of daily necessities low to retain its price-conscious consumers, but that could put pressure on its bottom line as it seeks to finance new stores. In other words, Aldi must carefully navigate between expansion and profitability.


On the digital front, Aldi already has a solid foundation with its WeChat mini-program. To build on this, Aldi could add more personalized services, such as curated product recommendations, tailored promotions and a streamlined loyalty program. This would improve the user experience, increase customer retention and deepen brand loyalty.

Moreover, Aldi can leverage data analytics to predict consumer behaviour more accurately. By understanding what consumers buy, when and why, Aldi could optimize inventory, offer timely promotions and create shopping experiences relevant to the local population.






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