Aldi targets 3,000 US stores by 2028

Aldi is on a path to become the second-largest grocery chain in the United States. The German retailer plans to operate more than 3,000 locations by the end of 2028. This target places Aldi ahead of every US grocery chain except Walmart. In 2024, the company generated approximately $29 billion in US sales, a figure that exceeds the revenue of Trader Joe's.

The company's growth relies on a model that prioritizes low overhead over store aesthetics. Shoppers find stores that often lack background music to save on licensing fees. Employees stock shelves directly from cardboard boxes to reduce labor costs. This approach creates a lower price point for consumers. Food reporter Deena Shanker stated that her comparison shopping over several months showed Aldi matching or undercutting Walmart prices.

Two primary tactics drive these savings. First, more than 80% of products on Aldi shelves are private label items. These store brands, such as Benton's Chocolate Sandwich Cookies, avoid the markups associated with national brands like Nabisco. Second, Aldi limits its inventory. The chain stocks only one version of each essential item rather than multiple brands or sizes. This strategy allows for bulk purchasing and reduces spoilage and storage costs. The limited selection means shoppers often visit other stores for niche items, but the core staples remain cheaper.

Competitors are responding to the pressure. Kroger and Wegmans have announced defensive price reductions. An analysis published in late 2023 found that grocery chains reduced markups by approximately 7% in areas where Lidl, a similar German chain, opened stores. Aldi's expansion forces these larger chains to adjust their pricing structures to remain competitive.

The company also differentiates itself through rotating merchandise. Aisles feature seasonal items like German spätzle and advent calendars. This strategy aims to attract higher-income customers by offering premium products at lower prices, such as honeycrisp apples and premium wine. The stores maintain a smaller footprint than traditional supermarkets, reducing real estate costs while keeping the shopping experience efficient.

Aldi's business model traces back to 1946, when the Albrecht brothers took over their family store. They maintained a small scale and limited selection as the company grew. This long-standing strategy has proven effective during economic downturns and current inflationary periods. The chain's presence forces a broader market adjustment, keeping grocery prices lower for American consumers despite rising food costs in other sectors.