German Discount Retailer Aldi Eyes Bulgarian Market

German discount supermarket Aldi, known for its aggressive price policy, is considering the possibility of stepping on the Bulgarian market, according to local media reports.

The company has registered a subsidiary in Bulgaria through its Austrian chain, branded as Hofer, Trud daily reported.

The news comes just days before German discount retailer Lidl opensits first stores in Bulgaria on November 25 2010 in a move that will heat up further the competition in the sector.

The shops will be located in 11 cities - Sofia, Plovdiv, Varna, Stara Zagora, Pazardzhik, Sliven, Kurdjali, Petrich, Montana, Lovech and Gabrovo.

At the beginning of the year German retailer Tengelmann decided to sell its discount retail chains in Romania and Bulgaria to its rival Lidl, which is part of Germany's Schwarz retail group.

The price of the deal, which has already been approved by the regulatory anti-trust body, was not disclosed.

Tengelman, the parent company of Plus, owns 96 and 23 stores in Romania and Bulgaria respectively.

In 2007 and 2008 Plus sold its business in most European countries. For the last several years the chain has been active in Austria, Romania and Bulgaria, with divisions in those countries in May 2008 united under the name of Plus Eastern Europe.

According to realtors the economic crisis in the past year has proved fertile for the discount retailers stepping on Bulgarian soil in recent months and the country will see their boom in 2010.

Three food discount chains are currently operating in Bulgaria; Kaufland, Penny Market and Plus.

Kaufland is a part of the Swartz Group which also owns Lidl. It is a soft discounter that entered the Bulgarian market in 2006 in Plovdiv. Now it is strongly positioned on the market with more than 26 hypermarkets.

Penny Market (Rewe Group) is another German soft discounter with an aggressive growth strategy for Bulgaria.