Neckarsulm, Germany-based discount supermarket chain Lidl has laid off around 200 employees in its U.S. operations as it initiates a restructuring of its business.
All of the affected employees worked at Lidl’s U.S. headquarters in Arlington, Virginia, U.S.A., according to Progressive Grocer, with no store-level workers eliminated. The cuts bring Lidl’s corporate workforce in the U.S. from 1,000 to 800 employees.
“While we remain committed to the long-term success of Lidl US and look forward to continuing our expansion along the East Coast, we are continually evaluating our operations to ensure we are supporting our stores effectively,” a Lidl US spokesperson said.
Lidl U.S. is undertaking a corporate restructuring with the goal of ameliorating its financial standing, according to Lebensmittel Zeitung. The German news site reported Lidl’s rapid upping of its headcount in the U.S. outpaced its store expansion.
Aletos Advisory Grocery Retail Analyst Sebastian Rennack said the chain is “likely feeling the pressure of cost increases on profitability” and had made similar counts in its operations in other countries.
“In markets where rival discounter Aldi also operates, Lidl has traditionally focused on staying price competitive. But that strategy appears to be changing as, in the U.K. for example, Lidl has fallen behind Aldi on price and also reduced its store expansion plans,” Rennack said. “[It] is about safeguarding profitability rather than gaining market share as in the past.”
Lidl opened its first store in the U.S. in 2017 currently operates 178 supermarkets, all in the U.S. East between Georgia and New York, led by Virginia, which is home to 33 Lidl locations.
It has seen a high turnover rate among ...
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