Aldi and Waitrose have been revealed as the fastest growing retailers in the UK, in the first study of its kind being unveiled today at Retail Week Live! by OC&C Strategy Consultants.
Aldi and Waitrose, which came in first and second place respectively in OC&C’s rankings of the 20 fastest growing retailers on British soil, epitomise a trend which is seeing value retailers like Aldi, Primark and B&M Bargains, and premium-end brands like Waitrose, Burberry and Harrods, dominate the leader board. Overall, six premium brands appear in the UK rankings alongside 10 value brands.
German supermarket chain Aldi has grown revenues by an average £1.2bn per year since 2011 (approximately 38% year-on-year growth), as a result of opening about 40 new stores in the UK every year. British supermarket giant Waitrose has seen revenues grow by an average £360m per year (approximately 7% year-on-year growth) over the same time period, thanks to a robust like-for-like sales performance, new store and format openings and developing their online offering.
Anita Balchandani, Head of Retail and Partner at OC&C Strategy Consultants, said: “We've seen the majority of growth in the retail sector come from its polar extremes in terms of price position. Although at first glance these retailers have little in common, what they all share is a trait to adapt the quickest to what matters most to customers, create strong propositions that are well-rated by customers, and good, transparent value, regardless of their price position.”
The study, which analyses the fastest growing retailers in the UK and the biggest Western retail markets (the US, France, the Nordics, Germany and the Netherlands), reveals that the UK has been a retail growth hotspot in the face of a challenging macroeconomic environment for those retailers that have managed to seize the opportunity. Fashion brands in particular, including Burberry and Net-A-Porter.com (fifth and fifteenth position on the UK leaderboard respectively), have been the engine for growth in the UK.
While the typical retailer operating in the UK grew by an average of only 1% in the UK based on the latest publicly available sales period, the top retailers in OC&C’s rankings have seen average growth of around 17% over the same time span. This has been the case not only for homegrown brands like ASOS and AO.com (ninth and fourteenth place respectively) but also foreign retailers expanding on British soil, like Aldi (first place).
Anita Balchandani, Head of Retail and Partner at OC&C Strategy Consultants, continued: “The fastest growing retailers in both the UK and across the biggest Western markets show that it is possible to grow against the odds in low-growth economies. They have grown by capitalising on and responding to key customer needs.
“Retailers are succeeding by giving customers the ability to shop on their own terms and reducing all points of friction in the shopping journey. Smooth web experiences, the ability to shop across mobiles, tablets and desktop, or being able to choose from a range of convenient delivery or collection options, have been a great growth formula for many of the pureplay e-commerce successes like Amazon – who internationally is amongst the fastest growing retailers.
“We’re seeing a range of key customer trends - be they the growing importance of convenience, value, luxury and healthy and active lifestyles. Those retailers which grow will find that they do so by exposing their businesses to these tailwinds.”
A spokesperson from Aldi, the fastest growing retailer in the UK, commented:
"Our distinctive approach to everyday low pricing drives our growth. The efficiencies of our business model allow us to deliver outstanding, often award winning, quality products at a price that can't be beaten. With over half our products sourced in Britain, when Aldi customers visit our stores they know they can do their full weekly shop with us and trust Aldi to offer them the highest quality. In fact, Aldi's Swap & Save campaign has shown that our shoppers can save 30% to 50% on their weekly shop compared to other supermarkets. In 2014, over half of the UK visited an Aldi store and we are proud more and more customers are choosing to shop at Aldi"
Mark Price, Managing Director of Waitrose and Deputy Chairman of the John Lewis Partnership said: "It's good to see Waitrose amongst the fastest growing retailers. Against the backdrop of a tough deflationary market we've increased sales, won new customers and gained market share. This growth results from the investments we're making to create modern Waitrose: new shops, services, and hospitality in existing branches, driving our online and convenience businesses, deepening relationships with customers through the myWaitrose card and, of course, staying ever-focused on fabulous products and top notch service"
The 20 Fastest Growing Retailers in the UK:
- Aldi (UK & Ireland)
- Sports Direct
- John Lewis
- Home Bargains
- B&M Retail
- JD Sports
- The Range
- Dunelm Mill
The 10 Fastest Growing Retailers in the West (the UK, US, France, the Nordics, Germany and the Netherlands):
- Aldi Group
- TJX Companies
For further information please contact:Lucy Hopkins, Lucy Butterfield or Veronica Rossini at Ocfirstname.lastname@example.org
0207 260 2700
Notes to Editors
- Our study included around 630 Retailers with >£200m revenue (2013) and publically available financials (reported in BvD)
- This list is taken from the 200 largest retailers in each of the focus Western geographies: UK, USA, Germany, France, Netherlands, Nordics
- We have considered the list in two revenue tiers; Enterprise >£1bn, Large £200m-£1bn
- We then identified the ‘Growth Leaders’ as a shortlist of the 50 fastest growing retailers in each revenue tier, based on the 2011-13 revenue growth (% CAGR) reported
- We only included retailers whose growth rate is greater than the retail market growth for the local geography in both 2011-13 and 2012-13
- We ranked the Growth Leaders based on growth in terms of absolute value uplift (£m) between 2011 and 2013 - ie the retailer ranked number one achieved the highest increase in £m revenue 2011-13 (e.g. Apple +£38k 2011-13)
Founded in 1987, OC&C is a leading global strategy consulting firm that brings clear thinking to the most complex issues facing today's management teams. OC&C's client roster includes some of the world's most respected companies throughout the business services, retail, consumer goods, media and private equity sectors. For more information about OC&C Strategy Consultants, please visit http://www.occstrategy.com