When it comes to choosing where to do your weekly food shopping, two of the biggest names in the game are Kroger and Aldi. Kroger is the largest supermarket chain in the United States, with nearly 2,800 stores across 35 states and annual sales of over $132 billion in 2021. Aldi, on the other hand, is a rapidly growing German discount grocery chain known for its rock-bottom prices and no-frills approach. It now has over 2,000 stores in 38 U.S. states.
But while both Kroger and Aldi sell groceries, that‘s where a lot of the similarities end. Aldi is laser-focused on delivering the lowest prices possible through a unique, streamlined business model. Kroger operates more like a traditional supermarket, with a wide selection of products and a variety of in-store services.
So when it comes to the Aldi vs Kroger debate, which store delivers the best value and experience for shoppers? As a retail industry analyst and consumer expert, I dug deep into the data and strategies of these two grocery giants to find out. Whether you‘re a budget-conscious shopper, a busy parent looking for a one-stop shop, or somewhere in between, here‘s what you need to know to decide if Aldi or Kroger is right for you.
Aldi and Kroger: The Basics
First, let‘s start with a quick overview of each company‘s history and profile:
Kroger:
- Founded in 1883 in Cincinnati, Ohio
- America‘s largest supermarket chain by revenue
- 2,764 stores across 35 states as of 2021
- Operates multiple formats including supermarkets, multi-department stores, and convenience stores
- 435,000 employees
- $132.5 billion in sales in fiscal year 2020
Aldi:
- Founded in 1946 in Germany, first U.S. store opened in 1976
- No-frills discount grocery model with 90% private label products
- Over 2,000 stores in 38 states, mostly in the Midwest and East Coast
- Aggressive U.S. expansion with the goal of reaching 2,500 stores by the end of 2022
- Over 25,000 U.S. employees and over 200,000 globally
- U.S. revenue estimated at $15 billion annually
Aldi vs Kroger: Side-by-Side Comparison
Here is a table comparing Aldi and Kroger across key metrics:
| Metric | Aldi | Kroger |
|---|---|---|
| Store Count | 2,000+ | 2,764 |
| Avg. Store Size | 12,000 sq ft | 80,000 sq ft |
| Number of Products | 1,400 | 15,000 (up to 225K at Marketplace stores) |
| % Store Brands | 90% | 30% |
| Employees Per Store | 10-15 | 70 |
| Annual U.S. Sales | ~ $15 billion | $132.5 billion |
| Delivery/Pickup | Limited | Widely available |
| Typical Customer | Value-focused, budget shoppers | Broad range: bargain to upscale |
| Loyalty Program | No | Yes |
| Fuel Centers | No | Yes |
| Other Services | None | Pharmacy, banking, clinics at some stores |
Sources: Aldi, Kroger, CNN, Forbes, Winsight Grocery Business
As you can see, Aldi and Kroger differ significantly in scale and strategy. Aldi sacrifices breadth of assortment and extras like fuel centers for a lean model that enables unbeatable prices. Kroger goes for variety and more of a "something for everyone" approach.
The Aldi Difference: How This Discounter Keeps Prices So Low
To understand how Aldi and Kroger really differ, you have to look at Aldi‘s unconventional business model. Aldi isn‘t just cheaper than Kroger – it‘s cheaper than just about everyone, with prices up to 50% lower than traditional supermarkets. Here are some of the key ways Aldi cuts costs:
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Private label focus: Around 90% of Aldi‘s products are private label. Selling its own brands gives Aldi more control over manufacturing and distribution to lower costs. Kroger is expanding its private label selection, now at 30% of products, but still relies heavily on national brands.
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Curated selection: Aldi stores carry just 1,400 core products, compared to 15,000 at a typical Kroger and up to 225,000 at a Kroger Marketplace. Fewer products means Aldi buys much larger quantities of each, scoring bigger bulk discounts. Focusing on the essentials also makes stocking and inventory management more efficient.
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Minimalist store design: Aldi stores are no-frills and much smaller than traditional grocers at just 12,000 square feet. That‘s about 1/7 the size of a typical Kroger! Smaller stores mean lower rent, utilities, and property taxes.
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Streamlined operations: Everything about Aldi stores is designed for efficiency and cost savings. Most products are displayed in their shipping boxes rather than stacked on shelves. Shoppers bag their own groceries and pay a quarter deposit for carts (which they get back when the cart is returned). A typical Aldi only needs 10-15 employees to operate, versus around 70 at a comparably sized traditional grocery store.
These cost-cutting measures add up to serious savings that Aldi passes on to shoppers. A basket of staples like milk, eggs, butter, and bread can easily run 30-50% less at Aldi compared to Kroger. For example, a gallon of skim milk costs just $1.98 at my local Aldi vs $3.09 at Kroger. A dozen eggs is $0.79 at Aldi and $2.09 at Kroger. The difference is significant.
The Kroger Advantage: Selection, Service, and Convenience
Of course, Kroger isn‘t trying to out-Aldi Aldi. With its wide aisles, huge assortment, and plentiful staff, Kroger is targeting a broader range of shoppers who value selection and service over just getting the lowest price. Here are some of the things Kroger offers that Aldi doesn‘t:
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More products and brands: The average Kroger stocks around 15,000 products, and its massive Marketplace stores can carry up to 225,000! Even with expanding private label lines like Simple Truth, Kroger still gives ample shelf space to national brands that many shoppers are loyal to. Kroger aims to be a one-stop shop where you can check off your whole grocery list.
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More fresh food: As a traditional supermarket, Kroger has extensive fresh departments including deli, bakery, meat, seafood, and produce. It sources some local and organic products. Aldi is expanding its fresh and organic offerings but is still more limited.
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Extra conveniences: Two-thirds of Kroger locations have pharmacies, and over 2,200 have gas stations. Some stores also have prepared foods, sushi chefs, in-store bank branches, and wine tastings. Aldi sticks to grocery essentials only.
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Rewards and coupons: Kroger‘s shopper‘s card program gives customers access to personalized coupons, special sales, and fuel points that provide gas discounts. The average loyal Kroger shopper saves over $1,000 per year with the card. Aldi doesn‘t have a loyalty program, weekly sales, or promotions.
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Online shopping: With the popularity of grocery delivery and pickup soaring, Kroger has a big advantage thanks to its partnership with Instacart and in-house service Pickup. Aldi does offer delivery and pickup at some stores through Instacart, but its availability is spottier since the chain has been slower to roll it out.
So while Aldi wins on price, Kroger offers a lot more selection, personalized deals, and perks that many shoppers appreciate. For those who value variety and convenience, the bigger selection at Kroger could be well worth a larger grocery bill.
The Bottom Line: Which Store Should You Choose?
Now for the million dollar question: Should you shop at Aldi or Kroger? As a consumer savings expert, my analysis is that it depends on your priorities and shopping style. Here‘s my recommendation for who should choose which store:
Shop at Aldi if:
- Getting the lowest prices is your top priority
- You buy mostly staples and a limited assortment of products
- You‘re open to trying private label versions of your favorite brand name products
- You don‘t mind bagging your own groceries and you can stick to a specific list
- Quick in-and-out shopping appeals to you more than customer service and amenities
Shop at Kroger if:
- You appreciate wide product variety and a full-service supermarket experience
- You‘re loyal to certain brands or niche items that Aldi doesn‘t carry
- You value the convenience of one-stop shopping for groceries plus extras like pharmacy and fuel
- You rely heavily on grocery delivery and pickup
- You participate in coupon and rewards programs for the personalized deals
Of course, shopping at both stores – Aldi for staples and Kroger for extras – is also a smart savings strategy. "I advise my readers to keep an open mind and look for the best of both worlds," says Tracie Fobes, owner of the money-saving blog Penny Pinchin‘ Mom. By building your pantry with Aldi basics but splurging on select items at Kroger, you could score maximum savings and selection.
Future Outlook: A Shifting Grocery Landscape
The Kroger vs Aldi debate is likely to intensify in the coming years as Aldi increases its U.S. presence. The discounter is investing over $5 billion to remodel existing stores and rapidly expand from its current 2,000 locations to reach 2,500 by the end of 2022.
Aldi already captures nearly $15 billion in annual U.S. sales without a national footprint, so its market share is poised to rise fast as it blankets the country with new stores. Its super-efficient, scaled-down model should prove even more popular if the economy takes a downturn and price-conscious shoppers trade down to discounters. Traditional grocers won‘t be able to beat Aldi on price, but increased competition should spur more investment in store brands, smaller-format locations, and e-commerce offerings.
Kroger is already taking notes from Aldi with downsized urban stores and larger expansions of store brands. It‘s also making big investments in digital and delivery to hold its own against giants like Walmart and Amazon. With over 90 million households holding Kroger loyalty cards, the company has a trove of data to leverage as it tailors its merchandise and promotions to keep shoppers coming back.
Ultimately, the future of the U.S. grocery market is likely to be defined by the push-pull of Aldi-like discounting and Kroger-style selection and service. The ideal store will deliver both – and that‘s what all grocers will be striving for in the competitive years ahead. But for now, shoppers who can score the Aldi price point and Kroger experience stand to win big.
