For some city commuters, the new city location offers a better experience than the old format. Kelvin Dozier, who normally shops at Aldi in Brooklyn, recently started visiting the Manhattan branch right across the street from his office for convenience.
“It’s brighter here,” Dozier told the BBC, referring to the basket of fresh, sweet navel oranges. “The place in Brooklyn is a little smaller. It almost seems temporary, but this one seems like a permanent place.”
Nonetheless, winning over urbanites accustomed to premium brands still remains an uphill battle. Ralph Montenegro’s first visit to Aldi left him with a strong sense of loyalty to the competitor.
Montenegro said he still prefers Trader Joe’s, although he appreciated the prices on staples like flour and fruit because “they have more variety than Target.” He added that Aldi’s heavy reliance on packaged, private label processed foods is a mockery compared to the natural, organic options he prefers.
This strict reliance on limited private labels is what keeps Aldi’s overhead low, according to Dustin York, an associate professor of communication at Maryville University.
He says Aldi is aiming for a lean, efficient model that offers about 80% of what traditional large retailers carry at a much lower cost.
Still, York argues it’s unlikely Aldi will take dramatic market share from Walmart. That’s because Walmart, the retail giant, is so big. “I call Wal-Mart a battleship, and I call Aldi a kind of submarine.”
But sailing through congested waters can present distinct financial risks.
“Their biggest kryptonite is real estate costs,” York warned, pointing to the brutal Manhattan retail environment, where average rents range from $350 to $700 per square foot.
