Aldi Denmark loses money at frightening speed
The money is pouring out of the Danish Aldi stores. Aldi Denmark’s results for 2018 are characterized by declining revenue and a posted loss of DKK 381 million.
Aldi Nord Facts
Aldi Nord can look back on a more than 100-year-old merchant tradition and is one of Europe's largest discount chains, with more than 5000 supermarkets and 60.000 employees in Spain, Portugal, France, Belgium, the Netherlands, Luxembourg, Poland, Denmark and Germany.
The grocery chain Aldi had a hard 2018 in Denmark, which offered the ninth year in a row with deficits. Aldi’s 180 Danish stores gave a minus of DKK 381 million last year.
The result is a deterioration from 2017, when the chain lost DKK 326 million, informs Aldi Denmark.
Aldi director Finn Tang says that the deficit is greater than expected. However, it is no surprise that 2018 has caused big losses, as Aldi has invested heavily in a new store concept, employed more people and made new initiatives on campaigns.
“A long journey”
“The result is not satisfactory, but it is a long and extensive journey that we are doing, so it does not come as a surprise. In 2018, we implemented large parts of our new store concept – a process that we started in 2017. All stores have been modernized and have received a major boost,” says Finn Tang.
He says that Aldi does not expect fast results and that it will lose money also this year.
However, the CEO is very confident that the new stores will work in the longer term.
Negative results since 2009
“We are ready for that fight and we have already started searching for properties for new stores. We have a strong strategy, which in the coming years will deliver a much wider quality product range and a delicious shop experience. I am sure that over the next few years we will experience a customer influx, but it takes time,” says Finn Tang in a press release.
Aldi has not had any profits in its Danish stores since 2009, and overall the chain has lost minimum DKK 2 billion from 2010 until 2018, according to several analysts.
300 million DKK in fresh capital
After many store closures in 2017, Aldi is now expanding on the Danish market.
The parent company Aldi Nord several times had to pump fresh capital into the Danish subsidiary, which recently received an additional 300 million DKK.
However nothing indicates that the German parent company is giving up in Denmark. On the contrary, the Danish stores are investing heavily; and the company has recently launched its first TV campaign ever in Denmark.