Richest man

Chapter 15 Europe: The Brothers Albrecht (2)
These are two almost opposite development ideas.In Wal-Mart's view, what he wants to do is: provide consumers with as many choices as possible, so as to greatly increase the probability of consumers buying, so as to ensure that the market has the largest trading opportunities.But Aldi believes that he only needs to provide one choice, and all you can do is decide how much you want to buy!

The origin of this interesting approach is as follows: when the company first started in the 20s, only a small number of products could be provided on the supply list. In terms of the conditions at the time, everything was kept simple to ensure the next step of development.

The Albrecht brothers planned to gradually enrich the product range.But it didn't, they recall, because we found that our retail sales went up by offering less variety, and it was much cheaper to do so than comparable food chains.

Now, the average annual sales of a single commodity in the Aldi supermarket chain reaches 3000 million euros, and the world's largest retailer Wal-Mart has only 150 million euros, which is only 1/20 of Aldi, and the latter's annual turnover is almost Aldi. 6 times.

Another advantage of strictly controlling the number of varieties is that it is beneficial to control the quality of commodities, because the fewer the varieties of commodities, the fewer unqualified commodities may be; Procurement costs can be greatly reduced by expanding the procurement volume.The value of each contract signed by ALDI with suppliers is not less than 50 euros, and most of the contracts last for 10 years, so that the affordable purchase price can be maintained for a long time.

For these reasons, Aldi's products are always in a state of rapid circulation, coupled with appropriate measures, contributed to Aldi's sales miracle.Some items sold out on the first day, according to Aldi employees.Also because of this reason, many small and medium-sized enterprises are very willing to become Aldi's production enterprises.There is a reprinted proverb circulating in Germany, which may be the best explanation for this situation: "Competing for Aldi's long-term supply contract is as difficult as winning the qualification for the Bundesliga, and it is more difficult to be abandoned by Aldi than to be abandoned." It's even worse when a wife betrays her."

Resolutely refrain from advertising and image advertising

For a long time, Aldi has played the role of disruptor of modern business management theory.

A reporter once wanted to uncover the mystery of this chain store empire, but after several contacts, he was told that he might face the embarrassing situation of having no place to interview, because Aldi is one of the few organizations in the world that does not have a public relations or news release agency At the same time, Aldi’s annual advertising investment only accounts for 0.3% of the total turnover, and it hardly does any corporate image advertisements; the supermarket only publishes an eight-fold "Aldi Information News" every week. Advertise the new cheap products that will be on the cabinet.Information newspapers are placed at the exit of the supermarket and are picked up by customers.In addition, a half-page catalog is published once a week in the local daily newspaper.If there is a slogan, it is to add a note after some products: This product is limited in quantity, so buy it quickly.

Although Aldi operates in such a way that violates the concept of modern enterprise management, it has been greatly recognized in Germany.Whenever the product catalog is released in the early morning of the second day, in front of Aldi's seemingly "shabby" shopping hall, you can always see long queues of customers waiting to buy special items there.Now, Aldi's sales advantages are more reflected in some more expensive electrical appliances. For example, Aldi's personal computer sales rank first in the German computer market, and 60% of Germans buy from Aldi. In addition, it is the largest textile and clothing supplier in Germany.

It is unimaginable for many companies to resolutely refrain from advertising and image advertising, but in Aldi's view, this is something that must be considered for consumers, because not advertising means that Aldi can save money. The lowered advertising costs are passed on to consumers, which further reduces commodity prices and actually contributes to the growth of commodity sales.

"Crazy" cost reduction

Since it is necessary to provide consumers with goods at the lowest price, Aldi's ability to control the cost of goods is second to none compared to other companies.The cost of general goods includes three major parts: purchase cost, management cost, and logistics cost.

In terms of procurement, Aldi adopts the method of bulk ordering.Aldi has a dedicated procurement company responsible for the company's orders.Purchasing personnel search the world for the cheapest overall cost.Once a suitable partner is found, Aldi tends to order for a long time.Due to Aldi's stable and huge purchase volume, suppliers can arrange production in a planned way and update equipment. The manufacturer basically does not need a sales department, and at the same time does not need to advertise, which saves expensive advertising costs, and the cost of the manufacturer can be reduced to The lowest, so that the supply price is more favorable.Even if there are some products that are not purchased for a long time, Aldi will purchase them in large quantities in units of whole vehicles.Although Aldi's price is very low, suppliers are still willing to do business with Aldi, because Aldi's payment is extremely fast, and the payment for the goods will be remitted to the supplier's account within a week after the product leaves the factory. Moreover, Aldi Never look for such and such excuses to deduct payment like other shopping malls, or find excuses to make suppliers pay various sponsorships.Therefore, Aldi has a good reputation with suppliers and can get preferential prices that other companies cannot get.Aldi’s supply is also fixed: bananas from Brazil, kiwis from New Zealand, cucumbers from the Netherlands, citrus from Spain, and brine mushrooms from China.

In terms of management, Aldi's management methods have left peers and customers dumbfounded.

The benefits of Aldi employees are the highest among the peers, 10%-20% higher than other companies on average. For example, those who work well will be allocated buses after being promoted to community managers; those who are promoted to department directors can have an annual salary of 20. Wanmark.This is not because the Albrecht brothers are particularly kind, but because Aldi employees must have skills that are different from other places-to be able to do all the work of Aldi, and at the same time know the market well. Prices of all items in the .

Each chain store of Aldi generally only has two or three cash registers, employs only three or four business personnel, and the per capita service area exceeds 100 square meters, which fully taps the potential of employees.Everyone, including the store manager, holds several positions and has no fixed position, so they can be described as "all-rounders".When the business is busy, all staff gather at the cash register to check out, and take turns to tally goods and clean up waste packages when they are free.

Until a few years ago, Aldi required cashiers to recite the price of every item in the chain because Aldi never had large barcode scanners or modern cash registers for cost-saving reasons. , every cashier is the best cash register.The upshot: Aldi cashiers are able to collect payments faster than other stores that use barcode scanners.

Expand silently and start a frugal business

Although the excessive wealth has made Aldi appear on the wealth list "on time" every year, compared with other companies on the 3000 Rich List, Aldi has been expanding in an almost silent way.In Germany, its chain stores have reached more than 370, with an annual sales volume of 48 billion US dollars; even in the United States, where Wal-Mart is the old home, Aldi’s annual sales have reached 40 billion US dollars, and it plans to open 2010 stores a year in the future. Branches, and expand the total number to 1000 by 2010.New York retail and consumer product industry consulting company "Strategic Resources Group" estimates that by 0.65, Aldi will increase its current share of 2% of the US retail market to [-]%.

Despite its achievements, Aldi has always maintained a low-key personality.Aldi does not set up stores in prosperous areas, but generally located near residential areas or on the edge of towns, where the rent is cheap, but at the same time there is sufficient passenger flow.The area of ​​Aldi's branches (including warehouses) is generally 4000-6000 square meters, with about 100 parking spaces.Aldi's storefronts are extremely simple, without luxurious decorations. Storefronts in various places are often in the same format, and even the location of the products is roughly the same.In this way, it is extremely simple and fast to open a branch, and the cost can be reduced to a minimum.

In fact, Aldi's low-key traits are also a true portrayal of the character of the Albrecht brothers.So until now, people's understanding of the Albrecht brothers has only stayed in the situation of more than ten years ago.The reason why the Albrecht brothers have such characteristics is related to a special experience they had more than ten years ago.

One day in 1971, his younger brother Theo was kidnapped on his way home, and was released 17 days later after paying a ransom of 700 million marks.Because of this incident, the wealth of the Albrecht brothers was exposed to the world. When people discovered the huge wealth owned by the two unknown brothers, some frugal stories related to them were also widely spread: It is said that when the kidnappers kidnapped Special Olympics, Special Olympics was only wearing a worn-out suit, so even the kidnappers did not believe that this was the target of the kidnapping, and asked Special Olympics to show his ID card for verification; The A's family proposed a high ransom of more than 1000 million marks, but after bargaining with the kidnappers, the A's family insisted on discounting the ransom.

This is the legendary Albrecht brothers. Although many of these things have not been studied, people can still see some clues from the current external image of Aldi.Aldi's headquarters building is unpretentious, the company's employees drive mid-to-low-end cars, and the executives never take first-class travel.Diet Brands, who served as a director of Aldi for ten years, recalled: "The topic of their brothers' conversation was limited to competition issues. They never showed off. Saving became a habit and they often ate pasta in the staff cafeteria."

Can "rats" beat "elephants"

There are always various contradictory things in this world, but each thing has its reason for existence.

Just like people describe that Wal-Mart is often associated with behemoths, Wal-Mart has a wide variety of products, and the spaciousness of Wal-Mart stores... It is a phenomenon that exists to the extreme; and Aldi, if Wal-Mart is an "elephant" , then Aldi can only be a "little mouse" at most. Its not spacious store and a single commodity all show its characteristics, but can the "mouse" defeat the "elephant" now?
Always on the edge of the lowest price, Aldi must try its best to reduce costs and maximize profits in procurement, management and logistics.Although the Albrecht brothers have always wanted to build their own chain empire in a low-key manner, in fact, it is difficult for them to do that again.According to a report by McKinsey & Company, in some regions of Germany, Aldi's sales profit reaches 9.3%; while Doolittle LLP, a retail industry consulting firm in Chicago, believes that Aldi's profit margin is higher than that of Wal-Mart.

When all the secrets are revealed to the world, Aldi becomes the focus of everyone's attention and discussion. The company's financial information must be announced regularly, and all business skills have been studied countless times...Under such circumstances, Aldi It is no longer mysterious, and its "cheap" skills are being imitated and copied more and more.According to the survey and statistics of relevant German institutions: In Germany, cheap chain stores like Aldi are very developed, among which there are dozens of large-scale institutions, such as Lidl, Prouss and Norma, etc., all in Germany. Has a high reputation.Among them, Liddell has even launched an open competition with Aldi in many fields.

On the other hand, due to Aldi's long-term low price policy, and its own very high profits, this will inevitably lower the supplier's supply price, although most companies believe that dealing with Aldi is still profitable , but quite a few middlemen believe that their interests have been exploited; and due to the rapid expansion of Aldi, it has also led to the closure of tens of thousands of small stores every year.Under such circumstances, some suppliers joined forces to sue Aldi for the serious impact on their lives; even a company appeared in Germany to help other companies calculate the impact of Aldi's expansion on their companies. Loss.

Compared with the competitive pressure encountered in China, Aldi has encountered greater pressure globally. Although it has extended its tentacles to Wal-Mart’s old base in North America, in Germany, Aldi has also suffered from Wal-Mart’s huge pressure. challenge.

According to the report of the German "Der Spiegel" weekly, since mid-May 2004, Wal-Mart has launched a massive price offensive in Germany: Wal-Mart supermarkets all over the country (a total of 5) have launched "preferential programs" to attract people's hearts at the same time. , The price of some products was greatly reduced. For a while, consumers flocked to it, and some Wal-Mart supermarkets even saw a panic buying crowd that is rare in Germany.

And Wal-Mart isn't trying to hide the provocative nature of its deals.On the flyer distributed in Dusseldorf, it bluntly typed such an aggressive headline: "Why do you have to buy these products from Aldi-ours are cheaper!"

All of a sudden, there was a life-and-death struggle in the retail market in Germany: shortly after Wal-Mart cut prices, Aldi also launched a tit-for-tat price cut, which was even lower than Wal-Mart. shrink.Although relying on the huge strength accumulated over decades of development, Aldi can still face the competition calmly, but everyone understands that this is not just a simple price reduction battle, because behind Wal-Mart in Germany is Wal-Mart in the United States, which also has strong strength. And with the advent of globalization, the war between Wal-Mart and Aldi will come sooner or later.It can be expected that if there is a war between Aldi and Wal-Mart, it will be a protracted battle of life and death.Our mission is to hand over a sound company to the next generation.

(End of this chapter)