The genius ALDI trick Coles is borrowing — but will it cost you?

In a move that’s sending shockwaves through the Australian retail landscape, Coles has announced a bold strategy that might leave you scratching your head in the supermarket aisle. The retail giant is taking a page out of ALDI’s playbook, and it could mean big changes for your weekly shop. But what does this mean for savvy shoppers? Let’s dive into the trolley of intrigue and unpack this supermarket shake-up!

The great shelf purge: Less choice, more confusion?

Coles, Australia’s second-largest supermarket chain, is set to slash its product range by at least 10 per cent. That’s right, folks – your favourite obscure brand of pickled onions might soon be getting the chop! This strategy, eerily similar to discount supermarket ALDI’s approach, aims to simplify operations and potentially boost profits. But at what cost to the average Aussie shopper?

ALDI holds roughly 8% of the Australian supermarket market, while Woolworths dominates with 32.5% and Coles follows at nearly 25%. Image Source: Gonzalo Carlos Novillo Lapeyra / Pexels

Anna Croft, Coles’ chief commercial officer, has been waving the simplification flag, pointing out some eye-opening examples. Did you know there are currently 13 different types of basic table salt gracing Coles’ shelves? Soon, that number could be whittled down to just five. It’s enough to make you salty!

But it’s not just condiments feeling the pinch. Your haircare routine might need a rethink too, with Croft noting that the current six different sizes of haircare brands are creating ‘huge complexity’. Expect this number to be cut in half, leaving you with fewer options for your luscious locks.

The ALDI effect: A lesson in less is more?

To understand this move, we need to look at the German discount giant that’s been shaking up the Aussie supermarket scene – ALDI. Known for its no-frills approach and wallet-friendly prices, ALDI has been winning over cost-conscious shoppers, especially during these belt-tightening times.

But here’s the kicker – ALDI’s shelves carry a mere 1,800 items, compared to the whopping 20,000 to 25,000 products you’ll find at Coles or Woolworths. It’s a stark contrast that begs the question: do we really need 57 varieties of everything?

Jordan Lack, ALDI’s national buying manager director, puts it bluntly: ‘We believe that incremental range adds costs and complexity through our supply chain.’ It’s a philosophy that’s served ALDI well, allowing them to keep prices low and operations lean.

The price of simplicity: What’s at stake?

For our savvy shoppers, this shift could be a double-edged sword. On one hand, fewer choices might mean less confusion and potentially lower prices. After all, who hasn’t stood paralysed in front of a wall of pasta sauce options, wondering if the difference between brands 12 and 13 is really worth the mental gymnastics?

However, the flip side is a potential loss of choice and the comfort of familiar brands. As Gary Mortimer, QUT Professor of Marketing and Consumer Behaviour, points out, ‘Yes, you can save if you shop purely at ALDI, but there is a cost for that saving, and that cost is that you forgo range and choice.’

The bigger picture: Economic ripples and consumer concerns

While Coles might be eyeing bigger profit margins, not everyone is thrilled about this supermarket slim-down. Nationals leader David Littleproud has voiced concerns that reducing product ranges could hamper competition, potentially leading to higher prices in the long run. ‘This isn’t about anything other than Coles getting bigger margins at Australians’ expense by reducing competition,’ he warned.

What do you think about Coles’ bold new strategy? Will fewer choices simplify your shopping or leave you missing your favourite brands? Have you embraced ALDI’s minimalist approach, or do you prefer having more options at your fingertips? Share your thoughts and shopping experiences in the comments — we’d love to hear from you!

Also read: ALDI’s rising influence in the Australian supermarket sector

Abegail Abrugar
Abegail Abrugar
Abby is a dedicated writer with a passion for coaching, personal development, and empowering individuals to reach their full potential. With a strong background in leadership, she provides practical insights designed to inspire growth and positive change in others.

9 COMMENTS

  1. Folks, it’s really easy. Everything Coles and Woolies does has one, and only one, objective: to maximize and increase their profits. Nothing they do is for the consumer’s benefit. Some of what they do may benefit us consumers, but that is not the purpose. That is why legislation with real teeth is needed in so many areas. And that is why their profits have risen in the past year despite the pain most of us are feeling.
    If you disagree with me you really are living in cloud cuckoo land.

  2. It does not seem to matter which company you look at in terms of most respected 5 years ago (pre Covid), but they all seem to singing from the same hymn book.
    Hymn Q101. Do what you want and they will keep coming.
    Qantas, NRMA, AAMI, Coles, Woolworths and dare I say others, follow their market research bible and keep putting the price up and range and product quality down. Their marketing is confusing even to their own staff and the reasons for pricing and range, and in some cases complexity, is designed to make comparisons very difficult. If we give up trying to force true competition and let them get away with it, the customer just usually just starts using the convenience of the moment (ie we give up), and we will herded to brands we do not prefer, prices higher than they should be, customer support more appalling than ever.
    But I suspect with the latest customer survey results with all the companies losing so much respect and status, I hope the shareholders can bring the greedy boards to their senses and realise they are destroying their goodwill.
    Very interesting that Air New Zealand and Bunnings, both Kiwi outfits, are leading the likeable charts. Most people I know dislike even visiting Coles and Woolies, and haven’t heard a good about Q from my flying friends for quite a while.
    Are we apathetic? Who cares? Go Bunnings and AirNZ show them a thing or 2.
    In Fact Bunnings please buy Coles back and put the Kiwi Spirit back into supermarkets.

  3. I’ve been shopping at Aldi for a few years now. Some people don’t like that their favourite brands aren’t there. Well, let me say this… the quality is just as good at Aldi as elsewhere AND they prefer to buy Australian where they can. My grocery bill is definitely less than if I went to Coles or Woolies…. no to say it hasn’t gone up… it has. I find I don’t need to have 57 varieties of everything. I only need a good product for a good price.
    As for Coles cutting back on choices to make more money…. there it is in a nutshell. They don’t care about us plebs struggling to buy food, they’re there to make money. You can bet your boots that prices won’t go down either.. they’ll just take the extra cash.

  4. One thing this article didn’t cover was the likely loss of business for smaller Australian companies who are current suppliers to Coles, as they are likely to get the chop. More people losing their jobs and companies struggling to survive because of this proposed restructure is not good for Australia.

  5. We’re being advised by doctors to eat less processed food. So given that 90% of Coleworth’s offerings fall into that category, a cull can only mean fewer distractions for the heath-conscious consumer heading for the fresh fruit and veg!

  6. Remember that every product line that Coles removes is the loss of outlet for that company. This can be the difference between survival and viability.
    This is the potential death knell for another Australian business. More Australian businesses closing down with many losing their jobs.
    When possible, patronise the lesser brands and contribute to a full and vibrant Australian economy.

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