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Philippines: How discounter DALI keeps Prices remarkably Low

Discount Retail Chain DALI Philippines (owned by Switzerland-based DALI AG) has redefined the concept of affordability in retail, and in this article, we'll take a closer look at how they achieved this remarkable feat. When it comes to offering "acceptable" quality products at unbeatable prices.

The Rise of Discount Stores

Discount stores, strategically placed in residential neighbourhoods, have been gaining popularity among consumers seeking convenient and accessible shopping alternatives to the sprawling hypermarkets. Dali is at the forefront of this movement, pioneering a unique approach to hard discount retailing in the Philippines.

By the end of 2022, Dali had already established over 250 retail stores and three distribution centers in the south of Metro Manila. Their approach focuses on setting up stores in rural and peri-urban communities instead of premium commercial centers in the cities. This shift keeps product prices low, thanks to high sales volume of a limited product range and lean operations.

Efficiency is Key

One key aspect of Dali's success in keeping prices low is their commitment to operational efficiency. They buy products in large volumes, spend minimally on advertising, and opt for small, cost-effective store locations. The interior of their stores may not be fancy, but they are consistently clean and well-organized.

Customer-Centric Approach

Dali Stores also prioritize their customers. They offer an unconditional return policy for products that don't meet customers' expectations, demonstrating their commitment to customer satisfaction over short-term profits.

A Unique Shopping Experience

Dali's approach is refreshingly different from traditional stores. Based on my observations, Dali stores have several unique features that contribute to their low prices:

  • All of their stores have no security guards; instead, they rely on automatic doors to assist customers and use vaults to secure and store their store cash revenue.

  • They employ less fancy product displays on shelves, with products still placed in pallets and boxes, saving on display costs.

  • Dali stores have no baggers; customers are encouraged to pack their purchased groceries at the counter.

  • They strictly implement a "bring your own bag" policy, reducing environmental impact, while providing paper bags at a cost.

  • You won't find massive and intensive local promotional posters around the area; Dali relies on storefront posters to explicitly compare the prices of their private label brands versus mainstream branded products.

  • Dali maintains a lean inventory, focusing on the most essential products, avoiding unnecessary overhead.

  • They heavily utilize private label brands, further driving cost savings.

  • Dali offers a selection of cheaper imported products for sale, providing consumers with cost-effective choices.

Dali's approach focuses on delivering high quality at low prices while streamlining the shopping process. Their unique business model has made them a trailblazer in the world of hard discount retailing in the Philippines (and Southeast Asia, according to Nikkei).

As Dali continues to grow and expand its reach, one can't help but appreciate their dedication to quality, affordability, and customer-centricity. In a world where prices often seem to climb, Dali shows that keeping them low is indeed an art.


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