Grocery disruption: Aldi targets 3,000 U.S. stores by 2028

Aldi is set to operate more than 3,000 locations in the United States by the end of 2028, a milestone that would place it behind only Walmart in total store count. According to Bloomberg, this expansion cements the German retailer’s position as the fastest-growing grocery chain in the country. The company generated approximately $29 billion in U.S. sales in 2024, surpassing the revenue of rival Trader Joe’s.

The rapid growth is occurring while the broader cost of food continues to rise. Food reporter Deena Shanker, who conducted a multi-month comparison of prices, noted that Aldi either matched Walmart on price or charged slightly less. This pressure is forcing established chains to adjust their strategies. Wegmans and Kroger have announced defensive price reductions to remain competitive.

An analysis published in late 2023 examined the market impact of Lidl, another German grocer with a similar business model but a smaller U.S. presence. The study found that existing grocery chains reduced their markups by roughly 7 percent in areas where Lidl stores opened. Aldi is now replicating this dynamic on a larger scale across the country.

Aldi’s low prices rely on two primary operational tactics. First, more than 80 percent of the products on its shelves are private-label items. These include store-brand versions of popular national brands, such as Benton’s Chocolate Sandwich Cookies and Savoritz Golden Round crackers. By manufacturing or sourcing these goods directly, Aldi avoids paying the markup associated with established national brands.

Second, the chain limits its product selection. Founded in 1946, Aldi has maintained a strategy of stocking only essentials and limiting variety. This approach allows the company to buy inventory in bulk, which lowers costs. It also reduces waste from spoilage and minimizes the need for large storage areas and high real estate costs. The stores remain intentionally small, with staff placing products on shelves in their original cardboard boxes to save on labor.

To prevent customers from leaving for larger competitors during economic recoveries, Aldi has curated a more engaging shopping experience. The retailer features rotating items such as advent calendars and German spätzle in its aisles. It has also expanded its offerings to include premium products, such as honeycrisp apples and higher-end wines, at competitive prices.

The company is effectively unbundling the traditional grocery store experience. While competitors like Walmart and Target offer a wide range of non-food items, Aldi focuses strictly on essentials. It often locates stores near other grocery chains, allowing shoppers to purchase bulk items at Aldi and visit nearby competitors for the few specialty items Aldi does not stock.

This model creates a competitive environment that keeps prices low for American consumers. The pressure from Aldi’s expansion suggests that grocery retailers can still offer affordable options despite rising inflation. The market remains dynamic, with new strategies emerging to challenge established pricing structures.