Good article. Key paragraph: 'Mr. Corbett, his team of...

Good article. Key paragraph:

'Mr. Corbett, his team of executives, and the Board of Directors in-place from 2001 to 2006, were the individuals who had the best opportunity of depriving ALDI of an opportunity to be successful in Australia. Simply put, by allowing ALDI to set the opening price point on the 20% of lines (products) producing an average of 80% of the sales in a supermarket, Woolworths effectively abdicated their position as the Every Day Low Price leader. In addition, by failing to implement a strategy that assured consumers that Woolworths had the freshest products available of any supermarket or discounter in Australia, ALDI was able to market that their quality was on par with that of Woolworths and other grocery stores. When given a choice of shopping for quality products at low prices, consumers increasingly turned to ALDI. As ALDI became more popular, ALDI's management team invested heavily in growing the brand and gaining economies of scale as additional stores were opened.'

That's the Achilles heel for any store stocking 20 types of detergent, 15 brands of salad dressing, numerous brands selling the same 'stir fry chicken' sauces. People will go to the Aldi's, Costoco's, Amazon food's of this world to get 80+% of what they use each month. They'll go to Woolies to get those boutique items the smaller discount stores don't handle. Its happening already.

Plus deflation is evident. Today at Dan Murphy's i bought 12 bottles of branded Aussie sparkling wine for $7/bottle. 8 yrs ago it used to be $12 and then dropped to $10 a year or so ago. Now almost half orig price although i did buy on a special. Perfect to take a couple to a party and share around.