CHICAGO — Discount retailer Aldi USA, Batavia, Ill., has aggressive growth plans in the United States. The Germany-based chain has 2,400 stores in 38 states and is investing $9 billion to open 800 additional stores over the next five years.

“Aldi is growing faster than it ever has,” said Dave Rinaldo, president of Aldi USA, during an education session at the Private Label Manufacturers Association (PLMA) annual trade show held Nov. 17-19 in Chicago. “Our greatest fear is not having enough supplier partners.”

Many of those supplier partners exhibited at the PLMA expo, which was 15% larger than 2023 with a record-breaking 1,800 exhibitors. Manufacturers showcased innovations previously unavailable for private label, including culinary-inspired heat-and-eat meals, condiments and salty snacks, many with international flair.

“Store brands provide competitive advantages, build consumer loyalty and respond with flexibility to market changes,” said Peggy Davis, president of PLMA. “Business has never been better. As of Sept. 8, store brands reached record highs in market share, achieving 20.4% in dollar share and 22.8% in unit share.”

To continue such growth, it is paramount that manufacturers innovate. They also need to optimize costs along the supply chain.

“We need you to innovate,” Rinaldo said. “When you combine excitement with pricing and quality, that’s where the magic happens.”

Over the past decade, Aldi has evolved with how it works with suppliers. The updated strategy includes establishing long-term agreements with improved forecasting. The company collaborates and does not take lightly the critical role that suppliers play in its business. And it’s working, Rinaldo said.

“We surveyed our partners, and they ranked us higher (4.8 out 5.0) than any competitor,” he said.

He concluded by identifying what Aldi expects from its partners. They must be obsessed with quality. The retailer samples 35,000 items every year, and those that make it to shelf are the ones that consistently meet Aldi’s standards.

He also encouraged suppliers to focus on innovation and offer products that excite the shopper. And — Rinaldo emphasized — do not play games. Be transparent and not deceitful. Short-term tactics, such as reducing product size while maintaining price point, can damage trust.

“We believe our customers are smart,” Rinaldo said. “If you’re tempted to cut corners on quality to boost your margins or hit a price point, don’t do it.

“…our customers trust us. And when you earn that trust, amazing things can happen.”