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Keeping Lidl’s shelves stocked is harder than ever, says UK boss

Keeping shelves stocked is “harder work than ever before”, the UK boss of Lidl has said as shortages of drivers, warehouse workers…

By admin , in Money , at November 24, 2021 Tags: ,

Keeping shelves stocked is “harder work than ever before”, the UK boss of Lidl has said as shortages of drivers, warehouse workers and food processing staff put pressure on grocery supply chains.

Christian Härtnagel, chief executive of the German discount chain’s British arm, said problems with availability of products in stores had eased in the past 10 to 12 weeks and “the worst times are behind us” but “daily hard work” was still required to ensure there were no gaps on shelves.

He said the company was constantly having to seek new ways to work around problems, by simplifying ranges and other measures, as a combination of the pandemic, Brexit and trade disruption continued to affect businesses.

Lidl last week said it would be investing £18m to increase wages for its lowest-paid workers, from £9.50 to £10.10 an hour outside London and £10.85 to £11.30 within the M25 from March 2022, as part of efforts to retain and recruit staff in a highly competitive market. That comes on top of £8m invested in pay rises last year, as well as a £9.5m one-off thank you payment and gift voucher for staff in recognition of their efforts during the pandemic.

The retailer is to take on about 4,000 extra staff as it continues to open a store a week for the next four years, to reach a total of 1,100 stores in the UK by 2025.

Härtnagel said Lidl wanted to open stores “from London to Scotland and down to Southampton”, with its main focus on 1,300-sq-metre outlets. He added that it was not considering small convenience stores.

The group said sales increased 12% to £7.7bn in the year to 28 February 2021. It also made pretax profits of £9.8m, springing back from a loss of £25.2m a year before, despite returning £100m in business rates relief.

Härtnagel said the profits turnaround was the result of strong sales and “a laser focus on our business model” without the distraction of home deliveries.

He said online orders made up about 12% of the total grocery market in the UK, down from a peak of almost 15% last year during pandemic-related high street lockdowns, adding that he expected that share to diminish further.

“In future 90% of the market will be bricks and mortar and that is fine for us,” he said.

The supermarket chain is investing in digital expansion with the launch of its Lidl Plus loyalty app. It has also registered the Lidl Go name for an app that would help shoppers scan and pay for goods without having to visit a till. Härtnagel said Lidl was “exploring and working on” the service but there were no plans for a launch at present.