German mini-supermarket operator Aldi will open two grocery stores in San Bernardino, city officials disclosed this week.
Aldi has plans for establishing 45 of its discount grocery operations in Southern California.
San Bernardino represents a ready location for the company’s business model. At present the company intends one location at the south end of the city and the other higher up, most likely on or just off of Highland Avenue.
Just a few years ago, grocery chains such as Vons, Stater Bros and Albertsons were closing out smaller stores and building 40,000 and 45,000 square foot behemoths. Aldi’s model runs in the face of that, with more compact stores that have 10,000 square feet to no more than 15,000 square feet of shopping space, typically featuring five or six aisles.
Aldi’s move into the area comes on the heels of the apparent failure of Haggen Stores to make an inroad into Southern California. Haggen operated 18 huge high end stores in the Pacific Northwest and late last year and early this year expanded exponentially by purchasing 146 Albertsons and Safeway stores, 83 of which were in California. But the combination of Haggen’s high prices and steep competition from other grocery chains that emphasize low prices has resulted in Haggen taking massive losses, culminating in a recent decision to shut down 16 of the California stores it just purchased.
Aldi does not feature brand redundancy in its offerings, generally limiting customers to one brand of a particular food. Still, Aldi officials insist, they feature only quality brands and their bulk buying of large wholesale lots from the suppliers they have an established relationship with assures low prices.
This week the LaVerne City Council approved Aldi moving into a vacant Office Depot store in that city.
Aldi has plans to set up an operation in Yucaipa, where Yucaipa Companies owner Ron Burkle lives.
Yucaipa Companies owns or owned Food 4 Less, Boys Markets, Alpha Beta Markets, Smitty’s and Ralphs Grocery Company.
Aldi’s move into California is part of an effort by the German company to tap into the American grocery market, which is to entail a $3 billion investment aimed at opening 650 stores in 48 states. The company’s Southern California headquarters is in Moreno Valley.