Case 15
ALDI
Case Objectives
1) To examine the business model that is highly dependent on strategic alliances and
Problem Situation
This case does not ask us to resolve a particular problem. In fact, the case is an illustration of the
success that ALDI has enjoyed by forming very strong strategic alliances with its suppliers. In
Teaching Suggestions
If assigned as a take-home case study analysis, students should be encouraged to visit a local
ALDI store in their community to gather a first hand impression of the shopping experience in an
Case Discussion
Channel member selection is a two-way street. Channel members must select those
manufacturers from whom they choose to do business based upon the criteria they have selected
for the successful operation of their firm. The concept of a mutually beneficial relationship
Again, the motivation of channel members (from the retailer to the manufacturer) is also
necessary. Retailers, in this case, ALDI, tells the manufacturer what its needs and requirements
are (high quality private label products, packaged to go from manufacturer to retail sales floor,
etc.) and then what support ALDI requires from its suppliers (long-term contracts). ALDI uses
The establishment of these relationships then grows into a strategic alliance in which, if a firm
chooses to accept these conditions of doing business with ALDI, ALDI agrees to continue to do
business with the firm. The “win–win” is that the firm has a ready-made outlet for its products
and ALDI has the security of a continuous supply of the required products. The basic principles
for building a successful partnership are then achieved. This meets the definition of strategic
alliance, which is a “continuing and mutually supportive relationship between the manufacturer
and the channel member in an effort to provide a more highly motivated team, network, or
alliance of channel partners”.