The mid-20th century fruit wholesaler might have struggled to predict Lidl’s future. From its humble beginnings, Lidl has become a global retail giant. Known for its low prices, Lidl has expanded to 30 countries and over 11,000 stores.
In 2024, the supermarket made headlines with the development of a huge new distribution centre in Motherwell. The project spanned 630,000 square feet and became Lidl’s largest regional distribution warehouse in Britain. It used over 1km of precast retaining walls that are designed to cut costs and be built quicker than traditional poured-in-place concrete.
Lidl has grown from fruit shops in Germany to huge international projects. So what’s behind Lidl’s rise?
The History of Lidl
Going back to 1930, Josef Schwarz became a partner in a fruit wholesaler in Heilbronn, Germany. The business was more focused on wholesale operations than retail and specialised in exotic fruits. The company was renamed to Lidl & Schwarz KG, before Schwartz’ son, Dieter Schwartz bought the rights to the Lidl name.
The first discount store, along the lines of Aldi, opened in 1973. Four years later, the Lidl chain spanned 33 discount stores. Throughout the 1980s and ’80s, Lidl continued to expand across Germany and establish itself as one of the country’s leading discount chains. France saw the first Lidl store abroad in ’88, and the expansion continued in the ’90s. In 1994, the first store in the UK was opened.
By the 2010s, Lidl had stores in almost every European country. The company’s efficient supply chain and local sourcing of products, as well as the ability to manage costs, meant it could offer competitive prices.
The stores
Lidl is known for its no-frills, efficient stores. The layout is designed for speed with limited product lines. By limiting their products, the company reduces storage space and any stocking complexities – which further drives down their costs.
Another notable feature is the “middle aisle” dedicated to limited-time offers on non-food items like clothing, electronics, and household goods. These items may not always be bargains – The New Statesman published an article about the items “designed to look like short-term loss leaders” that are “not actually bargains”. Lidl also faced claims, along with Sainsbury’s, Tesco, and Co-op, that their “freshly baked bread” was not so fresh.
More certain is the company’s commitment to high-quality, low-cost food. Lidl have developed relationships with local producers, allowing them to offer high quality and locally sourced fruit and vegetables, dairy, and meat.
Sustainability
Like many other companies, Lidl has sought to enhance the sustainability of its operations. It has sourced sustainable seafood, reduced plastic packaging, and improved energy efficiency. The company has also committed to sourcing 100% of its cocoa and palm oil sustainably.
Chocolate sourcing elsewhere has a significant environmental impact. Ethical Consumer have highlighted concerns about deforestation: “just to maintain production farmers may find themselves embroiled in cycles of deforestation to boost short-term yield.” The Fairtrade certification on certain chocolate bars provides money to improve workers and farmers’ environmental conditions, as well as their social and economic conditions. Ethical Consumers say that “big chocolate brands are dragging their feet when it comes to improving conditions” and that companies should honour the Fairtrade Living Income Reference Price model.
The journey
Lidl has grown from a small fruit wholesaler to a global supermarket chain. Their focus on low prices and efficient operations have helped carve out a niche in a highly competitive market. The recent development of the distribution centre in Motherwell is an example of the company’s drive to invest in their future.
