Shoppers wonder why ALDI refuses to take a bite of the Apple Isle

The German discount supermarket chain ALDI, known for its competitive prices and unique shopping experience, has been a game-changer in the Australian grocery market since its arrival in 2001.

With nearly 600 stores across New South Wales, Queensland, Victoria, South Australia, Western Australia, and the Australian Capital Territory, ALDI has become a household name for many Aussies.

However, one state has been conspicuously left off ALDI's expansion map.


Tasmanians have been left wondering why they haven't been able to enjoy the benefits of ALDI's low-cost groceries and weekly Special Buys.

The answer to this mystery was recently revealed during a Senate select committee on supermarket prices, where ALDI Australia CEO Anna McGrath was questioned by the chair and Tasmanian Senator Nick McKim.


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ALDI declared it has no immediate plans to expand into Tasmania. Credits: Shutterstock


In her response, Ms McGrath admitted that while there is a demand from Tasmanians for an ALDI presence, the company has no immediate plans to set up shop on the Apple Isle.

The reason? It boils down to the ‘complexities’ of the supply chain and the additional costs associated with transporting goods to Tasmania.

‘There's many places within Australia, including Tasmania, that we see a future opportunity in,’ Ms McGrath stated.

‘It's just more complex, Tasmania, Far North Queensland etc, with the distance and the complexities of the supply chain, it just makes it less easy.’

‘That's not to say that we don't continuously review where we may expand in the future,’ she added.


Mr McKim asked her to elaborate on the ‘complexities’ involved, pointing out that both Coles and Woolworths encounter comparable supply chain challenges yet continue to operate in Tasmania.

‘I think it's a very valid point in terms of our uniqueness that our competitors do have representation in areas that we have either considered and delayed, or are currently in our consideration set,’ Ms McGrath responded.

‘That goes back to us having a very different business model. For us, the way that we're able to continue to invest in price is to keep our operating costs as low as possible.’

‘That means that when we're identifying where to expand, we do need to consider the additional cost and complexities that are involved.’

‘And therefore, when it comes to Tasmania, that would be largely the supply chain elements,’ she continued.

Mr McKim highlighted that "many Tasmanians would be disappointed" by the news that ALDI has no plans to establish a presence in the state in the near future.


While ALDI's absence in Tasmania disappointed many locals, it also sparked curiosity and speculation among shoppers nationwide.

This decision, addressed during a Senate committee inquiry into supermarket prices, sheds light on the complexities of retail expansion and supply chain management.

However, despite ALDI's stance, its strategic moves continue to captivate consumers and industry observers alike, prompting further scrutiny and analysis of the supermarket giant's market strategies.
Key Takeaways
  • ALDI stated that there are no immediate plans to expand into Tasmania citing supply chain complexities as the main reason.
  • ALDI Australia CEO Anna McGrath acknowledged she commonly receives requests from Tasmanians, but expansion to the region does not align with ALDI's low-cost business model due to the extra costs involved in transportation.
  • The issue was raised during a Senate select committee on supermarket prices where Tasmanian Senator Nick McKim queried the absence of ALDI stores in Tasmania.
  • Although competitors like Coles and Woolworths operate in Tasmania, ALDI's unique business model necessitates keeping operating costs low, influencing their decision to delay Tasmania expansion.
Have you been longing for an ALDI store in your area? What are your thoughts on the importance of competition in the grocery market? Let us know in the comments below!
 
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As a Tasmanian who previously lived in Brisbane and enjoyed the benefits of shopping at Aldi, I think a major point is missing from the argument regarding distance to Tasmania, shipping difficulties etc.
Tasmania is only a few hundred kilometres from Melbourne, while Western Australia is more than 10 times that distance. South Australia, is also a greater distance. The statement is defeated by its illogical answer. Both of those states are serviced by Aldi, so why not Tasmania?
Is there an undisclosed agreement with Coles and Woolworths to set their prices at will in order to fleece the Tasmanian public?
 
It's called economy of scale. Much like Vodafone that only provide reasonable coverage in certain metro areas, Aldi doesn't see a sufficient size market in Tasmania.
As a Tasmanian who previously lived in Brisbane and enjoyed the benefits of shopping at Aldi, I think a major point is missing from the argument regarding distance to Tasmania, shipping difficulties etc.
Tasmania is only a few hundred kilometres from Melbourne, while Western Australia is more than 10 times that distance. South Australia, is also a greater distance. The statement is defeated by its illogical answer. Both of those states are serviced by Aldi, so why not Tasmania?
Is there an undisclosed agreement with Coles and Woolworths to set their prices at will in order to fleece the Tasmanian public?
Ever tried to get something sent to Tassie that isn't accepted by Aust Post. Sea shipping cost are far greater than road transport cost. Most of the ferry freight is reserved for daily or weekly freight companies. Much like Aust Post does for air freight, they pay if they use or don't use. Often the reason something sent 'surface mail' arrives so quickly, they fill the space they pay for with what they can, with combined airmail & surface mail. The Tassie market just isn't big enough and they wouldn't set up distribution for such a small market, nor would they pay the additional transporting cost to supply such an unprofitable market.
 
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Reactions: Michelle Sc
Ah the joys of living in Tasmania, we really do miss out on so much. No Aldi or Ikea or anything else but we will have a new football stadium with a roof (🤣🤣🤣). Those of us who live in the north know that Launceston football events have better attendance than games in Hobart as a lot of tasmanians don’t like to travel very far. It’s a beautiful state but thank goodness l can escape to Perth every year. I’ve heard people say that Launceston has everything you could ever need so how come my friends & l can never find anything. Suppose I’d better keep searching.
 
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Reactions: Michelle Sc
well they just turned up in North Queensland Townsville, a couple of months ago.
i dont need to bring stuff up north. I used to send a picture and most of the time answer was yes. I\
I understand those people in Tasmania (particularly ex-mainland who know what they are missing)
 
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