Doing an Aldi

Posted on Jun 21 2016 - 10:00am by Scarlett Peters
RATING

Low-cost German electronics retailer enters UK market with value proposition

Reichelt, a successful German online retailer for electronics, automation and computer accessories, is entering the UK market with an English e-commerce site and delivery service for businesses and consumers.

Reichelt hopes to emulate the UK success of German grocery retailers, such as Aldi and Lidl, by offering lower prices than competitors.

Reichelt hopes to emulate the UK success of German grocery retailers, such as Aldi and Lidl, by offering lower prices than competitors.

The company was established in Germany in 1969 and has become a market leader as a result of its competitive pricing and high stock availability. It has more than 220 employees at its German logistics centre in Sande (Friesland) and currently generates annual revenues of around 125m Euro.

Reichelt hopes to emulate the UK success of German grocery retailers, such as Aldi and Lidl, by offering lower prices than competitors. CEO Ulf Timmermann says it is offering many of its products for 20% less than UK rivals such as Maplin, Mouser, RS and CPC-Farnell.

He said: “We supply business customers in the electronics and engineering sectors, from laboratories to workshops, education and IT, but we also meet the needs of the consumer audience. There’s a growing ‘makers movement’ in the UK and we are able to serve their needs, as well as businesses’, at prices lower than in Maplin, for instance, but at a higher quality than they might fid when importing from other international suppliers.”

Timmermann says Reichelt is able to charge low prices because it does everything itself, from writing its own ERP software to setting up its warehouses and managing its call centres.

As an added incentive to buyers, it offers discounts for bulk buying on certain products and VAT-free invoicing.

Reichelt’s aggressive growth plans include a €9 million investment in a third warehouse. Due to open at the end of April, this will enable Reichelt to increase the number of items it holds in stock to more than 100,000 by next year.

www.reichelt.co.uk

About the Author