German Retail Chain LIDL Plans U.S. Expansion
German retail chain LIDL is planning to expand its operations in the United States. The market is highly competitive but LIDL management is confident that they will be able to grab sizable chunk of the U.S. retail market. As per a recent analysis conducted by Jefferies on 20 popular retail items, LIDL stores offered nearly 9 percent discount compared to Wal-Mart.
LIDL already has 10 stores operating in the United States. The German retailer is now planning to open 80 more stores. LIDL has a better strategy and margin when it comes to sourcing its products. In Europe, LIDL has managed to project itself as above average quality retail company with low prices. The company sells nearly 90 percent of products on its stores under private label. The management has been successful in keeping high quality of product line.
Expansion of LIDL could spell trouble for Wal-Mart as the retail giant is already facing tough competition from Amazon. Amazon has improved its delivery timing and the company has managed healthy enrollments on its Prime membership. Compared to its U.S. competitors, LIDL keeps its staff costs lower.
The U.S. market is quite different to the European market. Within few quarters, we will be able to figure out if LIDL has managed to grab attention of U.S. shoppers.
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