German discount grocer Lidl is planning to open 20 stores in the US in 2017, and another 80 in 2018.
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One of the biggest chains in Europe, Lidl has 10,000 stores in 27 countries. Its arrival is scaring American grocery stores, including Whole Foods.
Though it’s a discount grocer, Lidl’s stores in the US will be fancier than the ones in Europe, responding to consumer demands. This will potentially steal clients from Whole Foods.
Lidl will invest in bakery and fresh products, will offer a wider variety of brands, and will look a little nicer.
Besides, Whole Foods, which is famous for being expensive, is trying to compete more with discount retailers like Walmart and Kroger. In 2016, it launched a cheaper chain of stores.
With the increased competition, it might have to do better to revert its six consecutive quarters of falling sales.
Even an appeal to quality might be less significant. Retailers like Lidl are getting better at making their own products. Store-brand products are sometimes even preferred over corporate brands.