Source: Lidl

Lidl in Hounslow, west London

A battle royal is raging among the discounters as they fight for the best sites in the lucrative south east – with Aldi this week pulling out of online delivery altogether to focus on store estate expansion.

The two German discounters have been going toe-to-toe when it comes to UK store expansion programmes.

Aldi opened 43 stores in 2022, while Lidl opened 51, according to data from location analytics firm Maximise UK.

But the numbers in the south east were even closer: nearly one in three stores opened by each discounter in 2022 was in the south east of England, according to Maximise UK.

Aldi opened 14 stores in the south east and Lidl 15. Within the south east, London was a priority, with Aldi opening six stores in the capital and Lidl four.

According to Aldi’s own numbers, it now has 58 London stores. Lidl has been on a similar push as part of a five-year, £500m investment in London announced in 2019.

As well as indicating where supermarket rivals are likely losing share, Maximise UK’s data also reveals how discounter stores are overlapping and competing as the store estates grow. Of Aldi’s new stores last year, about half (23) were within a mile of an existing Aldi or Lidl store. The same applied to 25 of Lidl’s 51 new stores.

“Trading overlap between Aldi and Lidl sites was the standout statistic,” said Maximise UK CEO David Haywood.

The store estates are almost identical in size, too. With Lidl’s UK estate standing at about 950 stores and Aldi’s at over 990, both need to open 50 or more a year to hit their end-of 2025 targets of 1,100 and 1,200 sites respectively.

Both have also been beset by planning delays thanks to raw material shortages since the pandemic, but also rival supermarkets regularly raising objections and legal challenges to new stores.

Aldi is already behind on a target of 1,000 stores by 2022 amid increasing difficulty in getting planning permission over the line, and expects to hit the landmark this year instead.

“Intense competition for prime sites” meant neither was likely to hit its 2025 target, Haywood added.

A drive to focus resources on estate growth, as well as low prices, is behind Aldi’s gradual winding down from this week of home delivery of general merchandise ‘Specialbuys’ and wines and spirits. It will leave grocery click & collect as its only online service.