Why Aldi's Home And Garden Products Are So Cheap
Americans love a good bargain, so it's no surprise that many savvy shoppers are visiting their nearest Aldi to save on everything from pantry staples and the latest in health foods to cleaning products and even garden supplies.
According to CNN, German-based Aldi has been expanding quickly throughout the United States. The company reportedly has more than 1,800 stores in 35 states, with plans to have 2,500 stores by the end of 2022. That would make it the third largest supermarket chain in the U.S. behind Walmart and Kroger.
"I never underestimate them," Walmart's U.S. CEO Gregory Foran said at an industry conference in 2019. "I've been competing against Aldi for 20-plus years. They are fierce and they are good."
Aldi's biggest advantage is its ability to offer low prices without sacrificing quality via its own private food labels. In fact, Aldi claims its prices are as much as 50 percent cheaper than traditional supermarkets, per CNBC. That savings also extends to its home and garden items, which Better Homes & Gardens called "one of Aldi's best-kept secrets." Shoppers have raved that deep discounts on plants, decor, and more can be discovered among all those boxes of cereal and bins of produce.
So how does Aldi manage to keep its products so cheap?
Aldi uses many strategies to keep prices down
One way Aldi is able to keep its prices down is by limiting the brand names offered in its stores. Instead, the chain relies on its own private labels, which make up 90 percent of its inventory, per Business Insider. While it carries only 900 core products, that limit keeps prices down for the consumer.
According to CNN, keeping less in stock also means Aldi doesn't need as much space. Its stores are typically smaller than its rivals, which result in lower rent costs and fewer employees needed to restock shelves. Aldi is "able to drive out every fractional cent of cost without compromising on quality," said Katrijn Gielens, professor of marketing at UNC's Kenan-Flagler Business School. Gielens estimates that Aldi's operating costs are about half that of mainstream retailers. In addition, the company is making some eco-friendly, cost-saving changes. Aldi announced in 2017 that it was remodeling some stores to bring in natural light and to utilize recycled materials.
When it comes to home and garden items, Aldi often showcases limited-time deals with many products priced under $20. Its website also promotes upcoming specials in advance — everthing from writing desks to fiddle-leaf fig trees, and Food52 "grocery story whisperer" Katie Workman nabbed sleeping bags for under 10 bucks!
Aldi customers do their part to keep shopping cheap
Aldi asks its customers to help keep products prices cheap. The company encourages shoppers to bring their own bags or pay to use theirs. Customers can also utilize any empty boxes they find around the store, reports CNN, and checkout lines move fast because employees don't bag groceries. Instead, shoppers move to another section at the front of the store after paying to pack items on their own.
Shoppers also need to put a quarter in the shopping cart to unlock it (you get the money back when you return your cart,) and they don't seem to mind. In fact, some customers get really excited when Aldi offers quarter-keeper keychains, while die-hard fans have been known to crochet their own versions. After all, it's a small price to pay to shop at a market that puts customer satisfaction first. The company recently revealed that it doesn't charge suppliers for shelf space in an effort "to suck the profitability out of the [supermarket] industry in favor of the consumer," per Business Insider.
That philosophy has led to some very loyal customers, like Diane Youngpeter, who runs a fan blog called the Aldi Nerd and an Aldi Facebook group. "I am willing to do the extra work because the prices are amazing," she told CNN. "There's a lot of Aldi nerds out there. I didn't realize that there were so many of us."