Supply Chain Management and Sustainability in Aldi

Project for logistics
supply chain strategy
management

Table of Contents
INTRODUCTION...........................................................................................................................1
Backgrounds ...................................................................................................................................1
Project topic ....................................................................................................................................1
Purpose of research .........................................................................................................................1
Business theory and practice............................................................................................................2
Research method .............................................................................................................................2
Purpose of research .........................................................................................................................2
LITERATURE REVIEW................................................................................................................2
METHODOLOGY..........................................................................................................................5
Data collection and analysis.............................................................................................................5
Presentation of findings...................................................................................................................6
Implications and recommendation.................................................................................................10
CONCLUSION .............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Backgrounds
The Supermarket and Grocery Stores industry is one of the most competitive price-based
industries with the emerge of their own low-cost private-label products. Australian retail and
grocery market segmentation stands at 2.2% of the Asia-Pacific food and grocery retail market
with values at 101,812.7 (Marketline, 2020).
Amongst the retail grocery industry, Aldi Australia emerges as the strongest competitor
with more than 500 plus stores in Australia since introduction in Australian market in 2001 with
the value of $102 billion. With its rapid expansion Aldi is expected to secure 9.2% of the
industry share in Australia with the products sourced sustainably to reduce the environmental
and social impacts of their production (ALDI, 2020).
Project topic
Aldi has primarily relied on the supply chain counterparts for the products and their
delivery to the customers as well as maintaining the supply chain relation and stock
management. However, with the forecast of increase in production, shipping and storage costs,
the retail giant should be focusing on supply chain management to research sustainable ways in
production to minimize negative impact on social reputation and economic growth (Genovese
and et. al., 2017).
The opportunity existing in sustainability and market growth is to focus on sourcing best
products at best price by advancing the supply chain relationship from fair labour practice to
reducing environmental impact. According to Mangan and Lalwani (2016), Aldi Australia
identified high risks areas in forecasting of inventories, sudden shortage of raw materials, which
highly impacts on the flow of products and customer satisfaction. This means that Aldi would
lose its reputation as a business aiming for the sustainable business growth where the business
might lose the customers and the forecasted revenue. By analysing and evaluating those risks
Aldi would be able to move towards achieving the sustainable supply chain (Meixell and Luoma,
2015).
Purpose of research
The purpose of this research is to critically analyse and evaluate the supply chain complexity,
risk management and sustainability of Germany supermarket retail Aldi to identify why the
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business choose to be the discounted retail in the world with the proper planning, controlling
and executing products from raw materials to finished products. Further, the recommendations
have been made for improving future supply chain performance based on company future growth
strategies.
Business theory and practice
The following theories (concepts and frameworks) that will be reviewed in this topic are:
- Supply Chain Design (Masoumuk et.al., 2014, Sustainable Supply Chain Design)
- Supply Chain Integration (Bals and Tate, 2018, Advancing the Theory of Supply
Chain)
- Sustainable Supply Chain Management (SSCM) Theory (Brandenburg,
Gruchmann and Oelze, 2019, Sustainable Supply Chain Management)
Research method
The case study research will focus on the retail industry and ALDI. The research method
includes collecting secondary data sources from the retail industry statistics from MarketLine,
journal articles such as Martins (2019), Faulk (2014) and Masoumuk at.al. (2014). The collected
data will be used to conduct quantitative and qualitative analyse of ALDI sustainable growth.
Tools that will be used are Benchmarking, six sigma and SCOR model. Primary data will not be
collected and analysed.
Purpose of research
The purpose of this research is to critically analyse and evaluate the supply chain
complexity, risk management and sustainability of Germany supermarket retail ALDI to identify
why the business choose to be the discounted retail in the world with the proper planning,
controlling and executing products from raw materials to finished products. Further, the
recommendations have been made for improving future supply chain performance based on
company future growth strategies.
LITERATURE REVIEW
The supply chain management is defined as the management of the flow of goods and
services which is done in transforming the raw material in the final product. As per the view of
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