On this day, February 20 in the year 1920, one of the famous entrepreneurs to find fortune in retail was born in Essen, Germany. His name was Karl Hans Albrecht, the co-founder of Aldi Supermarket.
Karl Albrecht was the son of a miner-turned-baker and a food store owner. His schooling was disrupted when he was drafted to fight for Hitler’s Wehrmacht during World War II. After the war, he and his brother Theo took over the small family store and renamed it Aldi, from the first two letters of Albrecht and Discount. As Germany started to reconstruct, the small store prospered by supplying goods at real bargain prices. One branch was opened and then another and soon there was an Aldi store in almost every town or city in the whole Ruhr Valley. Later, the two brothers agreed to split the business between them: stores in South Germany and the right to open in Britain, the Americas and Australia went to Karl while Theo took those in Mainland Europe.
In 1976, the first Aldi store in the US was opened in Iowa. It took fourteen years later, in 1990 for the company to open its first branch in Britain.
The brothers’ recipe for success was old-fashion everyday low prices, so low that many small competitors were driven out. To sustain the chain’s viability despite the almost near-bottom mark-up, stores had to make do with very minimal decoration and managers were told on scrimp on everything. They limited the number of items sold in their stores to those with high turnover in order to save on logistics. Generally, costly locations were avoided and advertisement was miniscule compared to competitors.
Karl Albrecht died in 2014 at the age of 94. Ha had two children with wife Mia. At the time of his death, the reclusive, frugal Karl was the richest in Germany with a net worth of $25.9 billion. His branch of Aldi then had over 5,000 stores including 1,300 in the United States.