business news in context, analysis with attitude

by Michael Sansolo

In the explosion of news over the Amazon/Whole Foods purchase, it’s easy to forget that life went on late last week. And boy, did it.

On Thursday, Lidl opened its first stores in the US and, as Arthur Miller wrote in "Death of a Salesman," attention must be paid.

An industry friend traveled down to Kinston, North Carolina, one of seven locations where the German-based discounter opened its doors, and walked away impressed in countless ways. Granted, opening day is hardly an indication of long-term success, but a quick tour of Lidl reminds us that future success won’t come on merely one front. In addition to thinking about the implications of Amazon’s purchase, Lidl’s entry demands serious focus. This is no small invasion either in terms of the number of stores planned or in how those stores operate.

Despite its emphasis on price, the Kinston Lidl comes in a very sleek and modern package. The sleek design continues inside the store with a clean and sharp European look in many refrigerated cases.

There’s a healthy dose of price specials and cut cases to drive home the point that this is a price operation. One section of the store actually features overhead signs proclaiming “surprises” for short-term specials. During last week’s visit the section featured ideas for Father’s Day, including men’s shoes and electronics.

The combination of inexpensive prices and sleek merchandising is one of many balancing acts in the store. Lidl makes no secret of its German roots with displays for products from the home country and even the use of some German phrases such as “Hallo” in signs. Yet other signs emphasize local produce and a commitment to continued sourcing of products as close to the stores as possible.

In many ways these juxtapositions of merchandising styles provide either contradictions or simple recognitions that shoppers are never one-dimensional. Sure Lidl might live on price, but it gives heavy play to organics, perishables, prepared foods and even the store’s environmentally friendly features.

Convenience, health and environmental issues matter to all shoppers, not just those in Whole Foods.

It will be interesting to see how shoppers react to all of this and how Lidl may evolve its operation as it gains more experience with the American shopper.

(The Washington Post this morning has a good piece about the Lidl invasion, which you can read here.)

My colleague made two other fascinating observances. First, directly across the street from the new Lidl in Kinston is its German rival Aldi, so this one location might be ground zero in whatever price war the two are likely to wage.

The second observation might be more relevant to many other operators. Just a few minutes away from the new Lidl my colleague found a local independent operator whose store looks as though it was last remodeled in the 1980s. No doubt, this retailer has long served the community and has a modestly successful business.

The future might not be so kind. And the future may already have begun. There were only two cars in the parking lot.

Whether the news is about Amazon or Lidl the lesson is the same. The world is always changing and of late, it’s been changing a lot faster and that means we all need to get changing as well.

Last week won’t be the last time we get that reminder.

Michael Sansolo can be reached via email at . His book, “THE BIG PICTURE: Essential Business Lessons From The Movies,” co-authored with Kevin Coupe, is available on Amazon by clicking here. And, his book "Business Rules!" is available from Amazon by clicking here.
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