By Darcy Lenz
The shopping list has been growing all week, there is visibly open shelf space in the pantry and as of breakfast time this morning, you’re officially out of milk… it’s time for a grocery run.
But where will you go? Publix, where shopping is a pleasure? Kroger, because it’s close to home? The Daily Co-op for local and organic? Trader Joe’s for not local but still organic? Earth Fare for less local and mostly organic? Walmart, because you also need to pick up a new shower curtain? Piggly Wiggly because it’s fun to say? Or for a change of pace, the newest addition to Athens’ grocery marketplace, Aldi.
Reaching out to an extensive clientele pool with carefully constructed, savings savvy business structure, Aldi is a growing international brand that thrives in communities from Iowa to Australia; and now, Athens, GA. The store has certainly met success in the Classic City, with opening day being a record-breaking day in terms of Aldi openings in Georgia and continuing to be the busiest Aldi store in the state. However, since construction began on Atlanta Highway months ago, Aldi has been wrapped in community misinterpretation– from who they are to what they sell (they’ve heard everything from ethnic food to auto parts) to who they’re selling to. Low and behold, the confusion surrounding the new grocery mart’s presence is actually indicative of a probable misinterpretation of Athens’ commercial market on a larger scale.
The Athens area is by no means suffering a shortage of grocery stores. Vice President of Aldi’s Jefferson division Thomas Behtz explains that “technically speaking, [there are] too many grocery stores in the market already,” but Aldi fills a distinct niche. A niche very similar to that which Trader Joe’s Joe’s fills “on the high end.” Likewise through near exclusively private labels, Aldi stands out from competing grocery stores in their catering specifically to shoppers’ wallets.
“Ultimately, the prices are what stand out to consumers the most,” Behtz says.
A branch of any such food mart, designed to provide quality products at notably discounted prices, seems quite appropriately placed in Athens-Clarke County, which has the highest poverty rate for its population size in the United States according to recent U.S. Census Bureau data. However, despite their low prices, Behtz specifies that Aldi is not marketed exclusively to low income individuals.
“What we’ve found over time, is everybody wants to save money,” Behtz says. “And since 2008, because of the economy, even more so.”
Aldi is able to offer their products at a fraction of competitor’s prices because of unique stipulations in their sales strategy. Rather than offering consumers a basket of around 45,000 goods like chains such as Kroger or Publix, Aldi keeps their selection limited to 1,400 items. And for each of these select products, the store will carry only roughly 1000 cases, perhaps containing multiple flavors/variations on the given item.
Thus, the company can offer variety and quality without pouring money into excess supply that may never be sold. Although numerically, the difference between items on Aldi’s market shelves as compared to other stores may seem quite drastic, offering everything from fresh produce and beef tips to gourmet chocolate and baking supplies, Aldi seems to adequately meet customer demand. University of Georgia graduate Lauren Hooper has regularly frequented Aldi with her husband Terrell Hooper since the store first opened in February. The couple has thus far been extremely satisfied with both the quality of their groceries and with the fact that they have often been able to cut their typical grocery bill in half when one-stop shopping at Aldi.
“There are times when we’ve bought everything there and it was great,” Hooper says. “But sometimes we do have to go to the normal grocery store because [Aldi] can be limited. They get what they get.”
Beyond a carefully selected inventory, the other critical factor in keeping Aldi’s prices low is owning a private label for the majority of their products, with the exception of a few specific goods, such as candy.
“I could probably count on both hands the number of name brand items we carry out of that 1,400,” Behtz says.
Providing for low prices and no overly complex choice selection, Aldi appears a perfect fit for yet another major sect of Athens’ populace, college students. At surface level, the conditions needed to draw in a collegiate clientele are present in Aldi, but in actuality, the brand does not typically appeal to students.
“More often than not, a college student isn’t going to work real hard to save money because they’re often still living off of Mom and Dad’s dime to a certain degree,” Behtz says. “So, in spite of the fact that most people think it’d be a great market, you know, in college towns, we don’t normally do all that great.”
In fact, Chris Blackmon, president of the commercial/land committee for the Athens Association of Realtors, points out that the opening of what could be considered low-market stores such as Aldi highlights an “interesting dilemma for Athens.”
When commercial stores look at Athens demographically, census data will show them low household median incomes and widespread poverty. However, these numbers do not account for the college students streaming into the local economy, many of whom hail from affluent neighborhoods and are accustomed to shopping at high end grocery stores at home. Being that many college students are still officially recognized as dependents living with their parents, their presence and any wages they earn here are not counted towards Athens’ population statistics. Accordingly, there may very well be more of a market for pricier stores such as Whole Foods or The Fresh Market in Athens than is being recognized, according to Blackmon.
“Athens’ spending habits are very different from what census data shows,” Blackmon says.
That said, shoppers may not find an overwhelming number of UGA students in line with them at Aldi, but most other age and socioeconomic groups will be well represented.
“What’s been surprising to me is when you go into the store is, how diverse the clientele is… We’re obviously pulling from all over town, Behtz says. “I see some of the older college students that are probably living off their own income and that sort of thing trying to make ends meet that are shopping there.”
The diversity of people shopping at Aldi on any given day reflects that the company’s eye is not focused exclusively towards the extremely finance-conscious, but more broadly toward anyone with a budget. And even if there truly are “technically too many” grocery stores scattered throughout Athens, the market has certainly proven receptive to these shops that accommodate a certain category of demand, whether it be high or low end.
From Behtz’s standpoint, “what it really boils down to…[is] if there’s a big enough population base, we’re going to be able to do business.”
Magazine Writing at UGA, Spring 2012, Dr. Suggs 