CBRE’s secret to successfully staging a statewide expansion as big as Texas

ALDICategory: Retailer Representation

Aldi-Large

Challenge

In 2005, ALDI Food Market, a chain of small, steep-discount grocery stores, was looking to expand into Texas. Lacking brand awareness in the state and knowledge of local development costs, ALDI hired CBRE to assist in their rollout of new stores in the Texas market and increase their brand awareness throughout the state.

Solution

Study

CBRE reviewed ALDI’s existing store locations in similar markets to determine the key success metrics for DFW. We relied on research, mapping and current relationships with developers and land owners to gain key knowledge on which areas would best support a grocer of this scale.

Educate

Not only did we have to familiarize ALDI on the Texas market; we had to educate the Texas property owner and developer on ALDI. Leveraging the credibility we have developed with landlords and the knowledge we have on the existing grocery market in Texas were key assets for both parties.

Execute

ALDI knew providing customers the highest quality food at the lowest prices possible would be a great fit for the Texas consumer. We strategized on how to implement ALDI’s plan to open several locations at once, rather than one location at a time.

To select premier locations for ALDI’s expansion, CBRE factored in success requirements, understanding the competitive market along with identifying and mapping an implementation strategy.

Results

CBRE became the first commercial real estate firm hired exclusively to represent ALDI in the United States.

  • CBRE thought outside of the box and worked with ALDI to redevelop highly visible locations, some of which had previously been utilized by non-grocery retailers.
  • CBRE helped ALDI execute their plan of rolling out BIG in the DFW market:
    • ALDI opened 26 stores in the spring of 2010.
    • ALDI opened 29 stores total by the close of 2010 in DFW
    • ALDI opened 6 stores in 2011, 5 stores in 2012 and 9 stores in 2013.
  • Going forward, ALDI is on pace to open 10 stores each year in the North Texas region.

“Stan Lotridge and the CBRE team has been an excellent partner for ALDI as we expand in Texas. Their knowledge of the market and their relationships in the marketplace are invaluable. The representation we receive is first class.”

— Steve Bowman, Director of Real Estate at ALDI

“Stan Lotridge and CBRE have shown to be an invaluable part of ALDI’s expansion.  Their integrity, relationships, and understanding of the entire process of development have been a key to our success.  ALDI values the partnership and looks forward to our future expansion.”

— Heather Rimmer, Director of Real Estate at ALDI

A successful DFW rollout led to ALDI’s continued expanding throughout Texas. CBRE’s Houston, Austin and San Antonio offices came in to consult on and execute in those regions. Fifteen stores are scheduled to open in Houston in 2013 with more slated to open in 2014. ALDI is now looking to expand into Oklahoma and CBRE is by their side every step of the way.

Lessons Learned

Creating a big launch for a new brand in a new market can be done when you put the proper plan in place (even during a recession!):

  • Leveraging existing market knowledge and relationships with developers and landowners is essential to educating a client on a new market.
  • Strategizing with the assistance of high quality mapping capabilities and key demographic information can give a client a competitive advantage when introducing a brand to a new market.
  • A downturn in the economy does not have to limit a brand’s expansion plan. Competitive awareness of a market and thoughtful site selection will lead to a successful roll out.

Get in Touch

For more information on ALDI, please contact:

Stan Lotridge, Senior Vice President

Rodger Anderson, Senior Vice President

 

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