The battle of the brands – Aldi gives Harrods a run for its money

Statistics released by Retail Week this week showed that two well-known stores appealing to a very different demographic make the same amount per sq ft from their portfolio.

 

The magazine examined UK retailers’ in-store sales to see which stores generated the highest sales density, and unsurprisingly, US tech giant Apple claimed the top spot with sales of £3,070 per sq ft.

 

However, the real eyebrow raiser was discount chain Aldi not only being one of the top five UK retailers, but the fact that it shared the position with exclusive Knightsbridge department store Harrods.

 

The two retailers came in joint fifth in the data, compiled by Retail Week Prospect analyst Philip Wiggenraad. Fashion house Burberry, entertainment specialists Game and Liberty department store took second, third and fourth place respectively.

 

David Walton, head of retail for Harris Lamb, says: “ Retailers need to look carefully at the property they commit too and ensure that the space they rent or buy truly reflects their needs. Taking advice on minimising voids or looking at first floors and basements to ensure that there are not alternative uses that make use of this space is a sensible policy for any retailer.

 

Most large retailers have significant estates, and if a significant percentage is not adding to the income then this will affect the retailer’s performance. If large retailers have this issue then the smaller ones will too and they may well not be managing the issues as well.”

 

The German grocer has made a phenomenal leap in the past five years. With its sales density increasing from £465 per sq ft in 2010 to £1,150 per sq ft last year, a huge achievement for the brand.

 

Top 20 retailers according to sales density per sq ft:

1               Apple                        £3,070

2               Burberry                £2,500

3               Game                       £1,500

4               Liberty                    £1,165

5=            Aldi                           £1,150

5=            Harrods                  £1,150

7               Asda                         £1,110

8               Conviviality          £1,040

9               Waitrose               £1,020

10            Tesco                       £1,005

11            Sainsbury’s            £ 990

12            Office                       £ 910

13            Morrisons             £ 885

14            Ted Baker              £ 870

15=         Jessops                   £ 850

15=         Booths                     £ 850

15=         Lidl                           £ 850

18            Selfridges               £ 750

19            Schuh                       £ 735

20            Zara                         £ 695

 

While the results provide food for thought, retailers do need to make savvy choices when it comes to taking on space. Harris Lamb’s Retail team can assist with reviewing retailers’ property policy and advise with making all space as profitable as it can be.