"There are no genuine discounters left in the UK." So said Malcolm Walker, founder and CEO of Iceland, at The Grocer's first Discounters Conference this week.
He believes it's a bad thing that discounters have moved away from the tried and tested model of having a limited range, extreme cost control and selling goods cheaper than anywhere else, a model epitomised in the early days by Kwik Save.
Aldi, Lidl and Netto have, it is true, evolved: the austere German discounter model was never going to work in the UK without some major changes. Aldi and Lidl had to reinvent themselves by remarketing their own labels, offering more chilled food and sprucing up their stores. They are now a colourful alternative to the mults (and aren't always cheaper).
Anyhow, in my view, the true spirit of discounting is alive and well in chains such as 99p Stores and Home Bargains. Whether these chains are "genuine discounters", they are booming because consumers find their particular value propositions compelling. That's an enduring strength that Walker should admire.
‘Discounter boom isn’t over – it’s just begun’ (7 November 2009)