Aldi with four aisles

Aldi is a Passive Equity Company owned by the founding Albrecht family.  In Germany the business is split into two, Aldi-Nord and Aldi-Sud after the brothers disagreed on selling cigarettes.  The brothers, Karl and Theo, built the business from 1946 from the few shops founded by their parents.  Now in their eighties they live on an island in North Sea.

It took some time for Aldi to be established in the UK as the Brits were used to a once a week shop whereas the Germans shopped twice using Aldi for the basics.  The store format is simple with a warehouse feel and the managers stacking the shelves and being on the front line with customers.  The recession in the UK is seeing a growth in business.

Once you get going (the very difficult part) the consumers fund the business growth by paying cash at the till whilst the suppliers wait a month or more for payment.  The same at IKEA.  This is a very different business model compared to a high tech startup in the Cambridge Cluster where there is the immediate cash requirement to pay the major expense of salaries each month whilst customers (if there are any) will demand credit terms.

The disadvantage of the retail business is that you require properties from which to sell your goods in volume, only small four aisle premises for Aldi, and it is difficult to grow globally quickly.  Also as Aldi found out, different countries have different shopping patterns where I guess that shopping paterns for software are  more uniform and people are happy to download and pay at a website.

But who wants to grow a business so large and end up living on an island?  Very sadly one of the Albrecht brothers was kidnapped in 1971 so they have special reason to take security very seriously.