ALDI gets serious about WINE - Stunning Wines & Amazing Deals

The good people at ALDI Australia were kind enough to send me some samples of their wines. As one of the country’s leading retailers, this German supermarket chain has come a long way in the 10 years it’s been operating down under. Over 210 ALDI stores now sell liquor, including a good selection of wines – check the full list here .

On August 1 this year, ALDI also set up an online shop that will deliver to the eastern states at this point. ALDI’s range is pretty limited at present but is expanding. At BWU$20, we’ve made pretty clear that we think we need much more diversity in the wine retail business, that’s why we’re talking about ALDI.

What makes ALDI different?

Earlier this week I talked with Jason Bowyer, the buying director who sets the course for ALDI Liquor, to understand how the company intends to position itself in a market dominated by Woolworths and Coles. Jason raised these points as key differentiators:

· – ALDI has an everyday low pricing policy, so its prices don’t change from week to week, while they go up and down like a yo-yo at competitive stores;

· ALDI doesn’t run around looking for special deals with large wine companies who have truckloads of wine to shift;

· – ALDI sells a large proportion of its supermarket products under its own labels known as Exclusive Brands, and it’s the same with ALDI’s wines:, a range of exclusive brands such as One Road, Kaiora Bay and A.C. Byrne & Co.

· – ALDI is developing a house style, and working with selected suppliers (wineries) to develop wines in line with that style.

A supermarket chain with style?

We haven’t worked our way through all the samples yet, but what is clear from the few white wines in the $10 – $13 range we’ve tasted is that they follow a cleaner line than others, and are supported by finer acid. Among the Sauvignon Blanc’s and SSB blends, there is a welcome lack of the sugar that has become such a staple in NZ savvies designed to appeal to consumers.

Jason says he aims for more complexity with the higher-priced wines, and that shows in wines like the Kaiora Bay Reserve Marlborough Sauvignon Blanc 2013. To achieve that objective, Jason isn’t afraid to experiment a little (with the winemaker’s help) by adding a small amount of barrel fermented chardonnay to the Kaiora Bay Reserve Marlborough Sauvignon Blanc 2013 ($13) for example, or a component of Chardonnay to their Pinot Grigio, to drive texture and depth in The Pond Pinot Grigio Chardonnay ($7).

ALDI also partners with well-known winemakers like Kym Teusner, Larry Cherubino and Bob Oatley to make exclusive lines like the Teusner The Pleasure Garden Shiraz Grenache 2012 and the soon to be released Vinatero series. Jason says these wines are small-batch, hand-made and will be quite limited so we’ll let you know when they come on stream.

Comparing ALDI to the big two

Jason says ALDI is a family company, and that suppliers prefer dealing with ALDI. The feedback from the market seems to bear him out: Suppliers prefer Aldi to Coles, Woolies proclaimed a headline in the Sydney Morning Herald earlier this year.

Suppliers told the SMH that ‘they prefer dealing with ALDI because it pays invoices faster and is easier to deal with. One said it was ”so much better and much more stable to do business with”. Another said Coles and Woolworths reduced supplier prices and took an extra 3% to cover marketing costs when products go on sale, where ALDI would absorb the losses on sales into its own profit margin.’

The article also reports Woolworths’ claims that ALDI had forced it to introduce a range of private-label products to be competitive. What a lot of crap – the BOBs of Woolworths and Coles go back years before ALDI even started selling wine. The article makes clear that ALDI buys ‘from local suppliers and ”even pays a premium to buy Australian”, and only asks them compete against other Australian suppliers (as opposed to suppliers from other countries).’

Ah yes, we really feel for the big guys. Woolworths recently posted record profits of over 6% on revenue – most retailers can only dream of returns like that.

ALDI’s own labels are grouped and priced as follows:

· Precious Earth – $2.70

· Elmfield – $4

· South Point Estate – $5 – 6

· Claire Creek – $5 – 6

· One Road – $7

· Second Left – $9

· A.C. Byrne – $10 – 13 (Le Premier)

· Kaiora Bay – $10 – $15 (includes Reserve)

· Tudor – $13

· 5171 – $13

· Blackstone Paddock – $20