Jason Hart, who was appointed as Aldi USA’s CEO in 2015, has overseen a coast-to-coast geographic expansion and concurrent evolution of the German hard-discount brand that’s helped to reset expectations of hard discount in the U.S and deeply influence the U.S. grocery industry as a whole. In connection with this week’s announcement that Batavia, Ill.-based Aldi has now surpassed 2,000 U.S. stores and announcing, after a lengthy wait, plans to open its first stores in Arizona later this year, Hart participated in the following email interview with WGB, lightly edited for style.
Jon Springer:How does the evolving recession bode for Aldi? Some food retailers have told me they anticipate a “different” kind of recession this time around given the restraints on spending already in place elsewhere in the economy, such as fewer restaurant meals, movies, sports, etc. Aldi has typically done quite well in recessions, so what’s your anticipation now?
Jason Hart: Aldi is committed to serving the community and supporting as many customers as possible during challenging times. At our core, Aldi is focused on providing shoppers with the groceries they want at prices that can’t be beat, and that will never change. Regardless of today’s climate and anticipated future market shifts, Aldi is committed to doing everything in its power to continue to offer shoppers the lowest possible prices.
COVID is also changing lots of shopper habits, including, according to many sources, less “shopping around” than prior. If so, this might result in fewer trips to stores such as Aldi. To what extent has Aldi seen this effect and how pronounced has it been? And what is Aldi doing to be sure it can keep up with how shopping patterns change?
Given our unique business model, we have the ability to be nimble in situations like this, adapt our products very quickly and provide the items customers need the most. Customer buying habits and demand are shifting as quickly, and we’re working closely with our suppliers to meet those shifts. You’re correct, the pandemic has resulted in people making fewer trips to the store; however, we’ve seen the basket sizes for each shop increase significantly, which has resulted in an overall increase in sales.
How is the Instacart offering meeting expectations and how, if at all, may Aldi move to gather more online shoppers. In retrospect, how important was adding this offering, which I can imagine wasn’t taken on without a lot of forethought on your part?
Our approach to e-commerce has been very successful and has allowed us to reach new customers every day. We know Aldi shoppers want choice and convenience in how they shop, and offering e-commerce services like delivery and Curbside Grocery Pickup is just another way to give customers options.
Ultimately, we’re focused on providing our customers the best foods at the best prices no matter how they shop. We plan to continue our rollout of Curbside Grocery Pickup over the next several weeks, aiming to add the service to more than 600 stores by the end of summer.
Can we have a word on your perspective on how employees in stores and at the offices have responded to the crisis?
I couldn’t be prouder of our Aldi team. From coast to coast, from our stores to warehouses to divisional and national offices, the team has continually impressed me with their dedication to each other and to the communities they serve. I am proud to call our team members my colleagues and I am deeply thankful for their hard work throughout these challenging times.
Regarding today’s announcement—how does 70 stores in a half-year compare with the building/opening pace during the prior expansion period?
In total this year, we expect to open nearly 100 new stores. We continue to outpace our competitors as we expand in markets we already serve, as well as in new ones, and are on track to become the third-largest U.S. grocer by store count by the end of 2022.
Some sources anticipated Arizona would come sooner than it ultimately will, with at least one source attributing the “delay” to a rethinking of the distribution center. Was that so? What changed if anything?
While we’ve been planning our Arizona store expansion for several years, it was important to us to wait to announce our plans until we were further along in the process and more details were confirmed. We’re excited to be able to officially share the news about our four new stores. We do not have information to share about opening a distribution center in Arizona at this time, but we will share updates about our continued growth plans as we have them.
What has Aldi learned from such a busy period of opening stores? Broadly, what went right, what could have gone better?
If there’s one thing we’ve learned during this pandemic, it’s the importance of being agile. Our primary focus has always been the health and safety of our employees and customers while ensuring essential products are available to our communities during these challenging times, and we’ve quickly implemented operational and supply changes, as needed, to maintain that focus.