Three Secrets Of Successful German Entrepreneurship

In the Forbes magazine's list of the world's richest men, German retailer Albrecht brothers ranked third and fourteenth with assets of 23 billion and 18 billion 100 million, and reelected the richest man in Germany.

So how did they work hard and turn into a famous retail giant at home and abroad by starring in the food store in the backcountry?

In the early 20s of last century, Carle and Teo Albrecht were born in a small town in Essen, Germany.

The brothers were poor in their childhood. As Ruhr coal miners' father lost their jobs in early years due to pneumoconiosis, their mother had to open a food store in the suburban miners' living area to subsidize their families.

The embarrassment of life made the brothers end their studies in their early years and went on to earn their living early.

Carle found a job in a gourmet store, and Thailand helped her mother manage the shop.

Family life has just begun to pick up, but the outbreak of World War II soon interrupted their peaceful life until the end of the war in 1945.

At that time, the domestic market was withered, and the brothers were looking for jobs everywhere.

It was not long before their mother died, so they took over the narrow food store left by their mother.

Due to the shortage of funds, the shops were not repaired at the beginning of the shop, and they only sold some small and thin commodities such as drinks and canned goods.

They have been trying to expand their business, but they have never had a good plan.

A chance encounter between Carle and Tai O has become an important turning point in the life of Tai and Europe.

One day, when they passed by a local shop, they found that there was an endless stream of people coming and going.

Out of curiosity, they browse the promotional advertisements in front of the store. The practice is to give coupons when shopping. At the end of the year, coupons can receive the equivalent goods free of charge by 3% of the total purchase amount.

It turned out that people came at the end of the year, and the brothers got inspiration.

But they did not blindly imitate, but noticed something unexpected: if the prices rose at the end of the year, the coupons in the customers' hands would depreciate.

Further, if it is not able to cash in, coupons are nothing but empty promises.

In fact, they considered the credit problem at the very beginning.

After careful deliberation, they decided to introduce a more secure immediate profit making strategy, declaring that the goods sold in each store will be reduced by 3% on the basis of the local minimum price.

If the price level is not up to the above level, it can claim the difference and reward the store.

Since then, small shops have been crowded inside and outside, and turnover has doubled several times a day, and their business has been successful.

With the integration of the global retail industry since 60s, the brothers have a premonition that the new discount retailing prospect is limitless, and then discover their mission.

In 1962, they opened the first discount store called ALDI in Dortmund. It was taken from the first two letters of Albrecht and Discount, reflecting their ideal of joining the discount retailing industry. Bly Hitt,

Since then, Al Di has insisted on the principles of serving the masses, plus the quality and low price offered by the products, not only the low paid class but also the middle class.

According to statistics, 75% of Germany's residents often buy in Al di.

With the reputation of Al Di, its chain stores have sprung up in Germany, and have formed a dense sales network in Europe, America and some other countries in Oceania.

Honesty and trustworthiness, honesty and integrity have always been regarded as the standard of Albrecht brothers. This is mainly reflected in the relationship between Hardi and customers and suppliers.

First of all, it is to ensure that goods are better.

The standard of choosing the supplier is the price and quality.

All suppliers are regularly submitted to the quality inspection authority, the commodity inspection foundation, for testing. Except for good scores, the rest will not receive orders even if they are qualified.

After receiving the order, the new product must first be tested in some stores for at least 3 months without being appreciated by customers.

Secondly, the quality control is very strict.

Shops usually focus on sampling inspection of commodities, often let the taster blindfold the taste of the food they sell, and immediately warn the manufacturer if they find the problem.

The quality problem is serious, and Adi dissolves the purchase contract and claims damages, so the supplier dare not be slack in quality.

At the same time, for the image of the company, the products with poor appearance are not put out, such as customers' leftover fruits, vegetables, bread and so on. They are thrown away as garbage after closing up every day.

As for customers who are not satisfied with the products they purchased, they do not need to give any explanation.

Another is keeping promise.

At the original price level, he said that as long as the cost goes down, sales will continue to be made to the customers.

Whenever manufacturers reduce the supply price, they do not wait for new goods to go on shelves, and immediately change the original commodity price.

It is better to bear the loss of high inventory and low sale, and also to fulfill the promise of making it beneficial to the people.

For most suppliers who depend on the survival of the company, Al Di is also sincere.

In addition to being slightly "harsh" on quality, there are no additional requirements and additional agreements, and no arrears are made.

Thus, the relationship between Al Di and consumers and suppliers is based on mutual trust.

In this way, no one will consider the quality and price issues in the Al Di shopping.

Over time, the public's general impression of Al Di is honest, fair and credible.

Since its inception, it has always adhered to the principle of simplification.

This simplification has a long history.

During the post-war period, domestic stores were generally in short supply. After the economic revival, when other retailers were expanding their varieties to cater for the market demand, he did not drift with the tide.

For many years, the shortage of varieties did not affect the development of the company. Moreover, the expansion of varieties means that the increasing complexity of management is self-evident in the face of increasing number of manufacturers.

For this reason, their strategy is to start with adjusting the variety structure and pick out the best selling products and strive to sell them at the lowest price in the industry.

So far, Al Di has retained only 600-700 commodities, and the average annual purchase amount of the single product is more than 40 million euros, resulting in a very low price, which makes the retail price competitive and makes up for the defects of the single variety.

As a result of implementing the simplified variety mode, the company has implemented decentralization of management.

They believe that centralized management can only produce endless contacts, continuous data, endless requests, and the tendency of dictatorship management.

To this end, they divided the enterprise into the northern and southern group of Al Di, and divided into 66 business areas in the whole country, and more than 60 stores in each region.

The company gives regional managers direct management rights such as purchase, distribution, finance, personnel and so on.

This simple management strategy not only mobilized the enthusiasm of the grass-roots units and individuals, but also reduced the difficulty of the management of the decision-making level of the group and dispersed the risk of centralized operation.

In other respects, Al Di also advocated simplification, giving up what they thought was cumbersome and unnecessary: enterprises do not have monitoring departments, cancel their annual plans, do not engage in consultants, do not do public relations work, do not do ISO9000 certification, do not make differential pricing and complex accounting and statistics, do not consult customers, do not hang advertisements, posters and so on.

According to Dieter Brandes, the former manager of Al Di, there are 21 similar items of abandonment in management, which undoubtedly promoted the improvement of the efficiency of team management.

In addition to being frugal and pragmatic, the simplicity principle of Al Di also includes simple control.

Carle's advocation of thrift is well known. It can be traced back to the era when Ruhr started shop.

It is said that at that time, when the business was very hot, they would rather let the clerk move the refrigerated food to the basement every night, and would not want to add cold storage.

This frugality, which is close to parsimony, has been widely talked about after dinner.

In any case, this philosophy of life has been maintained and become an integral part of its unique corporate culture.

Today, although the family is already rich, the brothers are still frugal, living in the humble buildings in the suburbs of Essen and living in ordinary civilian life.

Managers still use the old stationery that has been altered by zip code, and the office paper is often used up front and back; shops open away from the expensive and prosperous sections, and the shops are not decorated, far away from the warehouse, and the stores in the city do not even have parking lots. The area is very compact, only 500~800 square meters. Most of the goods are displayed and sold on the spot of cartons and pallets on the spot, and the goods are saved on space and tally time. The goods do not sign the price tag, most stores do not use bar code scanners, they still use the old-fashioned cash registers. On average, each store only employs 3.3 people, and employees often have many jobs. They also have a high sense of cost in terms of their management: the company headquarters only has two simply decorated five storey office buildings, no luxury company cars, and Germany post code has been promoted for many years, including Tai O.

These abstinence measures laid the foundation for Al Di's cost reduction and the implementation of the strategy of winning the cheap.

The success of Albrecht brothers is also due to their deep concern.

While developing their own retail networks, they are very concerned about the dynamics of retailers inside and outside the industry, and try to identify their strengths and weaknesses in order to adjust their market strategies in time.

From the point of view of discount retailing, they have adopted strategies such as purchasing globally, ordering large quantities of factories, buying and controlling suppliers, setting up production and marketing alliances with manufacturers, entrusting manufacturers with OEM, self production and self marketing, and so on. They have cut down the original intermediate links and launched the most competitive commodity, which has caused considerable pressure on their counterparts in the industry.

From the perspective of related formats, they have long observed that the warehouse stores located on the outskirts of the city are at lower prices, but the traffic is inconvenient, and some have to collect dues or bulk purchases.

As a result, they tried to improve Hardi into a concentrated storage supermarket, not only increasing the proportion of household commodities to more than 20%, but also distributing the shops more conveniently for residents to purchase in scattered places.

With the growth of strength, the expansion of the company has exceeded that of residents' communities. Its branches often stand shoulder to shoulder with large stores, and continuously divert the source of competitors.

At the same time, they also aim at the opportunity, take the initiative to cross industry competition, first for the department store industry, weekly replacement of 15~20 department store clothing sales promotion, consumers will hear news.

In recent years, a number of household appliances and office supplies, such as DVD, printers and so on, have been launched in franchise stores.

It is hard to imagine that in just 10 years, Aldi has quietly become the sixth largest textile seller and the largest computer franchisee in Germany.

Over the years, the company has been able to implement innovative business strategy with ease, mainly because it can learn from others and be able to integrate advantages of different formats.

At the same time, we constantly use low-cost structural integration and expansion to make ourselves a compound retailing enterprise mainly based on food and across a variety of industries.

Then, by using the market gap of competitors, they constantly nibble up their market share and gain the initiative of market competition.

When Carle was gradually becoming a global concern, he was still low-key and never publicized.

They did not attend public social activities and avoid media interviews. Their latest photos were published 17 years ago.

Because al Di belongs to the non-listed company, and the two brothers are very secretive about the business situation, and they are indifferent to the commentary and speculation of the media. So many people haven't really known their experience for many years, and the situation of Al Di is even more blurred. No one knows how much money EARdi has made.

Therefore, in the eyes of the public, everything about Ardi has added a layer of mystery.

Fortunately, it was not long before the German official issued an obligation to open a business. It was possible that people could be more or less aware of some of the status quo on the basis of media reports. The results were expected to be surprising: at present, it has more than 6800 branches around the world, including 4000 domestic branches, and the remaining more than 2800 in 11 countries in Europe, America and Oceania.

In 2003, Al Di achieved sales of 37 billion euros, earning more than 1 billion 100 million euros.

Accordingly, its corporate value is assessed by authoritative institutions as 40 billion euros, which is equivalent to the market value of Daimler Chrysler Inc.

People know the true meaning of the Mount Lu of the "poor shop" from this perspective, and the second year of the year is also showing the image of the German discount retailer.