Aldi ready to threaten Coles and Woolworths stranglehold

THEY are the little supermarket that could in Australia.

Now discount grocery store Aldi has muscled in on the big boys, threatening Coles and Woolworth's stranglehold on shoppers.

Analysts UBS expect that Aldi's sales will grow 15% per year for the next three years, far beyond what's forecast for the big two.

Its sales could top $14.8 billion by 2019 if it can fix issues with customer service and fresh food quality, according to a report by Fairfax.

Along the eastern seaboard, 56% of Australians who have access to an Aldi visit the stores once a month.

This is far beneath the 90% market penetration of Coles and Woolies.

UBS's Ben Gilbert said the increasing success of Aldi will be at the expense of the major supermarkets.

"In the UK the tipping point came when the discounters (Aldi and Lidl) lifted their share of main shops to more than 10 per cent," Mr Gilbert told Fairfax Media.

While still considered something of an underdog against Australia's two supermarket giants, Aldi is a worldwide powerhouse with 10,000 stores in 18 countries.

It has an estimated annual turnover of $77 billion.

By comparison, Wesfarmers -- which owns Coles and Bunnings, not to mention a variety of mines and industrial companies -- turns over an estimated $62.7 billion.

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