Aldi sales surge puts pressure on rivals

Aldi’s Tom Daunt has welcomed the year’s strong performance. Picture: DANIEL MUNOZDiscount retailer Aldi Australia has vowed to maintain pricing pressure on rivals in the $85 billion grocery market, after increasing sales by 13 per cent in 2014, outpacing food and liquor sales growth at Coles and Woolworths almost three-fold.
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Aldi Australia’s sales reached $6 billion in the 12 months ending December 2014, compared with $5.3 billion in 2013. The growth was underpinned by strong same-store sales growth and 25 new stores.

In comparison, Woolworths’ Australian food and liquor sales grew 4.7 per cent to $41.7 billion in fiscal 2014 and Coles’ food and liquor sales rose 4.6 per cent to $29.2 billion.

“We’re very pleased with the progress. We had a successful 2014,” Aldi group managing director Tom Daunt said on Tuesday. New stores took store numbers to 366, lifting Aldi’s market share in eastern states to 11 per cent.

UBS expects Aldi’s sales to reach $9.3 billion in five years and says revenue could hit $13 billion, challenging Coles’ and Woolworths’ stranglehold over the grocery sector, if it fixes issues such as checkoutqueues.

Mr Daunt agreed that UBS’s $9.3 billion forecast was “perfectly possible” and said Aldi’s national market share could approach 15 per cent over time as it opened up to 120 stores in Western Australia and South Australia and added 20 stores a year in the east.

“We have about 11 per cent share on the eastern seaboard (and) I’d expect we’d obtain that sort of success in the new markets of Western Australia and South Australia. There’s probably a little bit more market share that we could obtain out of existing markets on the eastern seaboard,” he said.

Aldi would maintain its lowest-price position in the market, despite renewed discounting and price investment by the big chains, Mr Daunt said. A basket of branded and private label groceries at Aldi was 20 to 30 per cent cheaper than a similar basket at Coles or Woolworths and the discounter enjoyed strong relationships with suppliers, he said.

“At the core of our business model is the need to offer the highest-quality product at the lowest price. It’s a very dangerous territory to get into for a discounter to allow others to encroach on that area and that’s certainly not part of our plan.

“We will always select the lowest price we’re able to afford to sell the product at, which is very different to the standard retail convention, which is to price products at the highest you’re able to get away with.”

But Mr Daunt played down speculation that Aldi’s sales could double or triple in the foreseeable future, saying “it’s not going to happen”.

“Despite our success over 14 years we do remain somewhat of a niche retailer, with a limited range of very high-quality products sold at heavily discounted prices. The niche nature of our business model won’t change into the future, even though Aldi has added more national brands to its private label range and is expanding its fresh offer,” he said.

“We’re a company that’s not focused on year-by-year sales growth and we’re not focused on market share. What we are focused on is investing in Australia over a long period of time to produce a sustainable, successful operation.”

Mr Daunt defended Aldi’s limited partnership structure, which averts the need to lodge detailed accounts with the corporate regulator, and has no plans to lift Aldi’s financial disclosures.

“We have set up the company to be a private company because we believe it gives us distinct advantages. That allows us to focus internally on the operations of the business and what our customers need,” he said.

However, unlike multinationals such as Apple and Google, Aldi appears to have paid a full corporate tax rate since becoming profitable five years ago and has no intercompany loans or licence fee arrangements with its German parent. Aldi Australia’s average corporate tax rate in the past few years was almost 31 per cent of net profit and in 2013 it paid $80 million in corporate tax.

Mr Daunt said Aldi Australia was keeping an eye on other markets in Australasia but had no plans “at this stage” to expand in Asia.


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Man injured in fight at Fairfield Heights

A man has been treated in hospital after being assaulted by up to eight teenagers at Fairfield Heights early this morning.
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At 12.30am, officers attached to Fairfield Local Area Command were called to Brooks Lane followingreports of a fight.

Police said two men, aged 20 and 22, were loading furniture outside a unit when they were assaulted by a group of seven or eight youths.

The older man was also struck with a chairbefore the group left the scene with his wallet and phone.

He was treated by Ambulance Paramedics for cuts and bruising before he was taken to Fairfield Hospital where he is receiving further treatment for a laceration to his scalp.

The teens are described only as being all male, Asian and Pacific Islander/Maori inappearance.

Anyone with information is urged to call Crime Stoppers on 1800 333 000.

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Plums ripe for the picking

ROBBED: Meredith Ramsey with her granddaughters Sienna and Keira Taylor with the plum tree that was completely stripped of its fruit while she was away.CLEVE resident Meredith Ramsey got the shock of her life when she went to pick the fruit off her plum tree only to find it totally bare.
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Mrs Ramsey said she and a friend had harvested some fruit from the tree before she went away for the new year.

“I went down to pick some plums to send to my son but they were totally gone,” she said.

“I called my friend to see if she had picked them but when she said she hadn’t I knew that someone had stolen them.”

She said with the amount of fruit that was on the tree, the thieves got away with about 10 kilograms of home grown plums.

“Anyone who knows me, knows that you can knock on my door and ask me and I wouldn’t have a problem with it,” Mrs Ramsey said.

“I rang the police, not that I think they can do anything about it, but because I wanted it on record that it had happened.”

Mrs Ramsey said she also turned to Facebook in the hope that people might be more vigilant and keep an eye out in future.

“I don’t usually do that kind of thing but I thought if it makes someone stop and take a second look at a person in someone else’s yard then it’s worth it.”

She said most of all she was disappointed someone would steal fruit from another person’s garden, especially considering what goes into establishing a productive garden.

“A lot of time and effort has gone into our fruit trees and we get a lot of pleasure watching them grow and produce fruit,” she said.

“It takes a lot of time, money and hard work to establish and maintain a garden, it’s not just there for other people to help themselves.”

Mrs Ramsey said she was now considering putting further measures in place to stop people trespassing and stealing from her garden.

“Our trees are already clearly fenced off but I am thinking about installing an electric fence.”

She said while there was nothing that could be done now she wanted to remind people to keep an eye out.

“Sometimes just stopping and looking at who is in someone’s yard is all that it takes, just being wary.”

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Rugby legend plays key role on Australia Day

Ex-Wallabies player and coach, Jim Williams is the official Australia Day Ambassador.
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Penrith’s Australia Day celebrations will include a visit by Premier Mike Baird.

He will give a speech at the Premier’s Reception at the Sydney International Regatta centre at 5pm, on January 26 before the concert at Penrith Lakes.

MP Stuart Ayers will host the event.

Jim Williams, Australian rugby union great, is Penrith’s Australia Day ambassador this year.

Mr Williams will give the ambassador’s address at the citizenship ceremony at the Penrith Civic Centre at 10am.

He will also attend the Premier’s Reception before attending the Australia Day Concert at the regatta centre.

Mr Williams will also attend and speak at the Australia Day Awards dinner on Thursday, January 22.

At this reception Penrith’s local Australia Day awards winners are announced.

Mr Williams was a winner of the Rugby World Cup with the Wallabies and won the Super 12 title with the ACT Brumbies in 2001.

After serving as an assistant coach at Irish club Munster, Mr Williams returned to Australia as part of the Wallabies coaching staff in 2008.

As a player, Mr Williams started at NSW Waratahs, moved to the Brumbies before making his national debut in 1999.

He played 14 times for the Wallabies.

Since April 2012 Mr Williams has turned his attention to the Closing the Gap initiative, working with the NSW Rugby Union on a federal government-funded program called Learn Earn Legend.

The program is aimed at indigenous students; supporting students to stay in school, finish and then go onto further education or employment.

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Project plans to revegetate 10 hectares of floodplain

GREEN GOALS: Chris Halliday on his property at Gladstone, near Kempsey.Worried by the prospect of all the trees in his paddocks dying off, beef producer Chris Halliday resolved to do something about it on his property at Gladstone, near Kempsey.
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Along with 10 other Lower Macleay landholders he became involved in a four-year Landcare project to revegetate 10 hectares of floodplain farmland.

Since late 2012 he has fenced off two “swamp” or wetland areas on his paddocks, weeded, sprayed, mowed, planted about 1200 trees, put guards around and watered them and watched them grow – some to more than four metres in height.

Shortly after he planted the latest batch of trees his farm had the worst frost the area had experienced in 30 or 40 years, he said, which killed some and damaged others, but most survived and are now powering ahead.

The trees he has planted are all native to the area – mostly swamp oaks (Casuarina glauca) and paperbarks (Melaleuca quinquenervia).

The paperbarks are planted into the wettest areas, with the swamp oaks in slightly drier spots.

All the swamp oaks planted were propagated from seeds from a dying tree on the property.

And it was watching trees ­keeling over and not being naturally replaced that got Chris involved in revegetation.

He believes many of the same species of native trees on properties all around the Gladstone and Smithtown area are around 100 years old and are dying from old age, but because cattle are grazed around them they are not regenerating, as any new trees are chewed off or trampled by the animals.

Project plans to revegetate 10 hectares of floodplain Chris Halliday

Chris Halliday

Chris Halliday

Chris Halliday

Chris Halliday

Chris Halliday’s property near Gladstone

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