Four questions with Lidl US CEO Joel Rampoldt

Lidl is working to make a big impact on the US grocery industry.

Owned by the Schwarz Group, Lidl is one of Europe’s largest grocers, with 11,550 stores across 32 countries. But it’s less known stateside, opening its first US store in 2017 and relaunching last October with the tagline “The Super-EST Market,” in an effort to build brand recognition.

This year, the discount retailer moved up to the top spot in Newsweek’s Best Supermarket rankings, has worked its way into Dunnhumby’s annual Retailer Preference Index, and is seeing notable foot traffic gains. It’s also been growing its footprint, now at more than 185 US stores, with new locations including Atlanta and Manhattan’s Lower East Side, and is hoping this expansion, along with low prices (including its signature 49-cent croissant), will reel in value-conscious consumers.

Lidl US CEO Joel Rampoldt, who took the reins at the discounter in 2023, spoke with Retail Brew about the company’s growth strategy.

This interview has been lightly edited for length and clarity.

What has Lidl’s expansion strategy been, specifically within urban areas?

New York is a natural fit for us, but it’s also a brand-building exercise. Many, many retail brands have gone through this thinking process. We’re like, “If we want to be known, we need to be in New York, right? We need to be recognized and be seen in New York.” And so that’s one of the reasons why we’ve expanded into New York. The customers are there. Our customers are there. The operational complexities can be very tough…but it’s worth it for us to be in those high visibility locations where literally millions of people will, of course, be able to see us.

You’re not catering your product mix at your stores to the demographic of New Yorkers or of people in different locales. What is the thought process behind that standardization?

In terms of true localization—like having a kosher set in New York, which many grocery stores do, we are not set up to do that—and our operating model depends on very consistent operational practices. We have handbooks about how to do everything, fromloading the truck to restocking the shelves. All that has to be very consistent. When you start tweaking the assortment and trying to localize it, you get sales guaranteed, because customers will buy those products you’ve selected for them. But it just creates too much complexity.

We don’t have to get our shoppers’ last dollar. We want them to come to us first. We recognize that there will be things that they go somewhere else to get because there will be some needs we just can’t meet.

How much runway do you have left for further efficiency? Is there a point when there are just no more efficiencies to eke out?

Every year, we always think, “Wow, we did it, but we’ll never be able to do that again.” Then you have to do it again. The fact is, there’s always more to take out. And the deeper you get into it, you stop finding $10 bills in the couch cushions, but you still find quarters and nickels and dimes that you can scrape out. Projects that in terms of the technology cost or the implementation cost wouldn’t have made sense a few years ago, we keep them in the back of our mind, and they come into focus as we get deeper and deeper into the cost efficiency. I was in a store recently, and we were working on a project to basically make sure that the store’s planograms and the sequence in which the categories appear is completely consistent across the fleet, so that when a pallet of goods comes in, it’s built such that stuff on the top is here and the top goes here and the next stuff goes here and the next stuff goes here—and it’s all in one aisle. That’s a level of efficiency that we wouldn’t even try to achieve years ago, but now we’ve done all the other things, that’s what we’re down to.

When you’ve done the easier stuff, then you have to start doing the hard stuff.

What does “value” mean to Lidl?

It’s not necessarily the right idea to have a product that’s much higher quality that’s higher priced. We can convince ourselves it’s better value, but if it doesn’t line up that way for the consumer, or they don’t understand the value, that doesn’t work.

Every place that I’ve ever worked, the people working there convinced themselves that their value was great, and it’s too easy to do that. You can always say, “Well, yeah, we’re a little bit more expensive, but our apples are big. We have a this-size apple, and their apples are that size, so our value is actually great.” You can convince yourself of anything. But what we try to do is put ourselves in the consumer’s shoes and say, “Does she actually care about that?” If your apples are cheaper, but ours are a little more expensive, but bigger, does she care? And probably not, actually. So we really need to be disciplined about providing value the way the consumer expects to experience it.