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Aldi and Lidl: graduate recruitment scheme key part of success Aldi and Lidl: graduate recruitment schemes key part of success
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The rise of Aldi and Lidl in the UK has been driven by low prices, but there is another secret to the success of the German discounters: their graduate recruitment scheme. The rise of Aldi and Lidl in the UK has been driven by low prices, but there is another secret to the success of the German discounters: their graduate recruitment schemes.
The companies’ ascent has been rapid in recent years as shoppers have discovered that the discounters’ smaller shops and limited ranges can cut the amount of cash and time they spend picking up the weekly shop. The companies’ ascent has been rapid in recent years as shoppers have discovered that the discounters’ smaller shops and limited ranges can cut the amount of cash and time they spend on the weekly shop.
Related: Aldi wins Which? supermarket of the yearRelated: Aldi wins Which? supermarket of the year
Aldi and Lidl now account for 10% of grocery spending in the UK and are predicted to keep stealing business from their rivals: analysts believe their market share will hit 15% by 2020, while former Morrisons boss Dalton Philips said that if the big grocers didn’t match the discounters’ prices they would eventually take 25% of the market. Aldi and Lidl now account for 10% of grocery spending in the UK and are predicted to keep stealing business from their rivals: analysts believe the pair’s market share will hit 15% by 2020, while former Morrisons boss Dalton Philips said that if the big grocers failed to match the discounters’ prices they would eventually take 25% of the market.
It is extraordinary growth for two retailers who arrived into the UK in the early 1990s and struggled to make any headway into the market for almost two decades. However, while customers are attracted to Aldi and Lidl by the convenience of their stores, the quality of their own-brand food, and the low prices compared to Tesco, Asda, Sainsbury’s and Morrisons, less is known about the people devising this plan and executing it. It is extraordinary growth for two retailers who arrived in the UK in the early 1990s and struggled to make any headway for almost two decades. However, while customers are attracted to Aldi and Lidl by the convenience of their stores, the quality of their own-brand food, and the low prices compared with Tesco, Asda, Sainsbury’s and Morrisons, less is known about the people devising this plan and executing it.
Aldi and Lidl’s approach to staff is as simple as their approach to selling food. They try to hire the best staff, train them, and keep them in the business. And they pay market-leading salaries.Aldi and Lidl’s approach to staff is as simple as their approach to selling food. They try to hire the best staff, train them, and keep them in the business. And they pay market-leading salaries.
The companies are the highest payers of shopfloor staff in the industry. The discounters announced in recent months that they would pay the living wage – as opposed to George Osborne’s national living wage. Aldi pays £8.40 an hour outside London and £9.45 in London, while Lidl pays £8.20 and £9.35. This compares to £7.20 for the chancellor’s national living wage, which takes effect in April. The companies are the highest payers of shopfloor staff in the industry. Both announced in recent months that they would pay the living wage – as opposed to George Osborne’s “national living wage”. Aldi pays £8.40 an hour outside London and £9.45 in London, while Lidl pays £8.20 and £9.35. This compares with £7.20 for the “national living wage”, which takes effect in April.
The 50,000 workers at Aldi and Lidl are undoubtedly worked hard. Employee reviews online almost uniformly praise the pay and benefits but criticise the long and unpredictable hours.The 50,000 workers at Aldi and Lidl are undoubtedly worked hard. Employee reviews online almost uniformly praise the pay and benefits but criticise the long and unpredictable hours.
Related: Lidl rides the wave of UK wine boomRelated: Lidl rides the wave of UK wine boom
Graduate starters are offered even more lucrative deals. Aldi offers a starting salary of £42,000, rising to £70,000 after four years, with an Audi A4 and private healthcare. Lidl pays up to £38,000 and also provides a fully expensed company car. Rival retailers, by contrast, generally pay their graduate starters £23,000-£26,000, with some specialists – such as those joining IT and e-commerce departments – earning up to £30,000. Graduate recruits are offered even more lucrative deals. Aldi offers a starting salary of £42,000, rising to £70,000 after four years, with an Audi A4 and private healthcare. Lidl pays up to £38,000 and also provides a fully expensed company car. Rival retailers, by contrast, generally pay their graduate recruits £23,000-£26,000, with some specialists – such as those joining IT and e-commerce departments – earning up to £30,000.
At Aldi, 90% of the company’s 180 directors joined as graduates and there are also 400 graduate area managers. There are 600 graduates at Lidl in management roles. Matthew Barnes, the boss of Aldi in the UK, and Ronny Gottschlich, the Lidl boss, both started at the company as graduate trainees. At Aldi, 90% of the company’s 180 directors joined as graduates and there are also 400 graduate area managers. There are 600 graduates at Lidl in management roles. The boss of Aldi in the UK, Matthew Barnes, and his Lidl counterpart, Ronny Gottschlich, both started at the company as graduate trainees.
“As a graduate, being in an interview with the managing director of the Darlington region straight away made a huge impression on me,” Barnes says. “I learnt more about the role, and the chance to manage individuals older and more experienced than me was an intriguing proposition. I wanted the job at that stage.” “As a graduate, being in an interview with the managing director of the Darlington region straight away made a huge impression on me,” Barnes says. “I learned more about the role, and the chance to manage individuals older and more experienced than me was an intriguing proposition. I wanted the job at that stage.”
Once graduates joining the discounters are inside the business they are offered the chance to progress quickly and travel to other parts of the Aldi and Lidl empire around the world. Graduates at the companies enjoy secondments in the US, Australia and Europe.Once graduates joining the discounters are inside the business they are offered the chance to progress quickly and travel to other parts of the Aldi and Lidl empire around the world. Graduates at the companies enjoy secondments in the US, Australia and Europe.
Lucinda Thompson, a buying manager at Lidl, worked at the company’s head office in Germany. “From an early stage, you’re given a large amount of responsibility and are expected to negotiate at the highest levels and develop supplier relationships,” she says. “Now I look after my own category [of food]. I can’t imagine a more varied role. No two days are the same and there’s nothing more rewarding than seeing a product that you’ve created being picked up by customers in store, selling well and winning awards.”Lucinda Thompson, a buying manager at Lidl, worked at the company’s head office in Germany. “From an early stage, you’re given a large amount of responsibility and are expected to negotiate at the highest levels and develop supplier relationships,” she says. “Now I look after my own category [of food]. I can’t imagine a more varied role. No two days are the same and there’s nothing more rewarding than seeing a product that you’ve created being picked up by customers in store, selling well and winning awards.”
Related: Aldi and Lidl continue to march ahead of big four rivalsRelated: Aldi and Lidl continue to march ahead of big four rivals
Both companies plan to take on hundreds more graduates in 2016 as they step up their expansion plans. Ruth Doyle, regional managing director at Aldi, said: “Aldi’s graduate scheme offers significant levels of responsibility, and the year-long training course covers the key areas of the Aldi business including store operations, trading, financial administration, logistics and property management. After a year, graduates are expected to be fully functioning area managers, responsible for three to four stores, through providing clear direction and leadership to retail management teams.Both companies plan to take on hundreds more graduates in 2016 as they step up their expansion plans. Ruth Doyle, regional managing director at Aldi, said: “Aldi’s graduate scheme offers significant levels of responsibility, and the year-long training course covers the key areas of the Aldi business including store operations, trading, financial administration, logistics and property management. After a year, graduates are expected to be fully functioning area managers, responsible for three to four stores, through providing clear direction and leadership to retail management teams.
“Aldi aims to attract the best retail talent through providing market-leading salaries for all of its positions, allied with comprehensive training and unrivalled progression opportunities for individuals who wish to have a long-term career with the company. The success of Aldi in the UK has been driven by the commitment, hard work and ambition of our employees, and they will be crucial in Aldi’s continued expansion.”“Aldi aims to attract the best retail talent through providing market-leading salaries for all of its positions, allied with comprehensive training and unrivalled progression opportunities for individuals who wish to have a long-term career with the company. The success of Aldi in the UK has been driven by the commitment, hard work and ambition of our employees, and they will be crucial in Aldi’s continued expansion.”
Ten years ago, investment banks and consultancy firms were the top destinations for talented graduates. Today, German discount grocers based in Warwickshire and Wimbledon are also in the mix.Ten years ago, investment banks and consultancy firms were the top destinations for talented graduates. Today, German discount grocers based in Warwickshire and Wimbledon are also in the mix.