Robert L. Gentieu / The Morning Star – Aldi Inc. will open three new stores in the Lehigh Valley region at shuttered Bottom Dollar locations and sell or lease seven others, the company announced Friday.
The company said it has finalized the purchase of 66 Bottom Dollar assets from the Belgium-based Delhaize Group, including land and buildings associated with the retired discount grocery chain.
In November, Delhaize said it would sell its Bottom Dollar stores to Aldi for about $15 million as part of its plan to withdraw from the discount retail food segment in the United States. At the time, Delhaize employed about 2,200 people at Bottom Dollar stores, which were introduced in the Lehigh Valley in 2010 and closed late last year and early this year.
Aldi, of Batavia, Ill., said Friday it will open a total of 30 new Aldi stores at former Bottom Dollar locations in New Jersey, Pennsylvania and Ohio. In the Lehigh Valley region, Aldi will open stores at the following Bottom Dollar locations:
• 1856 Catasauqua Road, Hanover Township, Lehigh County
• 4034 Jandy Blvd., Lower Nazareth Township
• 703 Route 113, Hilltown Township, near Souderton
The chain will sell, sublease or designate for assignment the following Bottom Dollar stores in the region:
• 3235 Hamilton Blvd., South Whitehall Township
• 2919 Lehigh St., Allentown
• 719 Stefko Blvd., Bethlehem
• 2431 Butler St., Wilson
• 1529 Broadway, Fountain Hill
• 371 W. Broad St., Quakertown
• 1167 MacArthur Road, Whitehall Township
Another company or entity may take over the leases of stores that are designated for assignment, Aldi spokeswoman Julie Ketay said.
Aldi, which operates nearly 1,400 stores in 32 states, said it plans to open 650 new stores by the end of 2018 and expects to create more than 10,000 jobs at its stores, warehouses and division offices as part of the expansion plans.
Associates working at least 25 hours per week receive full health benefits and all employees may participate in the company’s 401(k) plan, Aldi CEO Jason Hart said in a news release.
“With the completion of this real estate transaction, we are able to ramp up our expansion plans in the region to meet the growing demand for [Aldi’s products],” Hart said. “While we are excited to pursue opening Aldi stores at 30 of these locations, we will continue working with those communities where we will not be using the sites to ensure a smooth transition.”
The chain employs a low-overhead approach that depends on volume purchasing, inexpensive real estate and cheap prices to deliver savings to its customers.
It’s a strategy that is not without risk in today’s fragmented food-shopping environment, said retail analyst Jeff Green of Phoenix-based Jeff Green Partners. Customers are looking for value, selection and quality — but not always in the same store, he said.
“The conundrum faced here is: The way we shop for groceries is a lot more different than the way we did it even five years ago,” Green said. “It used to be just a supermarket. Now people go to Trader Joe’s, then they go to Whole Foods. … Even farmers markets can cut into the traditional shopping experience.”
Green said he is cautiously optimistic about Aldi’s nationwide expansion plans at a time when discount competitors such as BJ’s Warehouse Club, Sam’s Club, Costco and Walmart also are growing.
With the economy plodding along toward improvement, and cheaper gasoline prices putting more money in consumers’ pockets, Aldi’s growth plan can be viable, he said.
“[Aldi] has been successful, but there’s a lot of pressure,” Green said. “It’s a weird industry.”