How Will Lidl Change The Face Of Retail?

05.18.2011 ZF English

The entry of Germany's Lidl on the domestic market will change the face of Romania's modern retail, a business of EUR7-8 billion annually, with the company set to swallow market share from the other discounters, as well as from larger-format players.

The opening of the first Lidl stores, one of the most highly awaited events of the past three years, will make the battle of prices even fiercer, considering price is the most important purchase factor for Romanians.

"The opening of Lidl store chain will have a deep impact over the domestic food retail market. Considering the experience of other European countries, Lidl is taking market share not only from discounters, but from other large formats as well. Given the low level of the average income in Romania, I believe this consumer migration will be even greater in Romania," explains Gorkem Tursucu, general manager of Architected Business Solutions (ABS) management consultancy.

There is no formula to predict the impact Lidl will have on a market, believes Michael Weiss, a vice-president of A.T. Kearney in Romania, one of the biggest international management consultancies.

He explains that if they continue opening stores along the same format, large players will not have any competitive advantage, but on the contrary.

More than a year ago, Lidl has acquired the Romanian and Bulgarian networks of Plus Discount from fellow German retailer Tengelmann.